Ezzsteel 2010 consolidated profit soars
Cairo, August 9, 2011
Egyptian group ezzsteel said 2010 consolidated net profit almost tripled, buoyed by strong domestic demand for long products and the restart of a flat steel plant.
Net profit for 2010 was 252 million Egyptian pounds ($42 million), while net sales rose 32 percent and EBITDA increased 29 percent, ezzsteel said on Tuesday.
Flat steel production jumped 49 percent to 1.46 million tonnes because of the restart of production at its EFS unit, ezzsteel said. Demand for long steel was underpinned by strength in housing and infrastructure last year.
Ezzsteel shares have tumbled this year as its founder Ahmed Ezz -- a political ally of deposed President Hosni Mubarak -- battles corruption charges from prison.
The charges levelled against Ezz centre on the company's dominant role in the local steel market and the terms of its purchase of its Ezz Dekhaila unit.
The company, which replaced Ezz as chairman in May, said it had suffered minor disruption and slowed production volume due to the political and economic turmoil that followed Mubarak's overthrow in February. Nevertheless, it reported higher volumes in the first half of 2011.
"We are confident that ezzsteel's business model, together with the expansion projects which are already progressing, will once again deliver even more compelling results when the Egyptian economy recovers and a more stable political environment returns," it said.
The company in July reported a 53 percent decline in unconsolidated 2010 net profit, which did not include results of high-performing businesses such as Ezz Dekhaila.
It said events in Egypt had forced it to delay construction of a direct reduced iron project, but banks were providing necessary funds and it hoped the unit would begin operations in the second half of 2012. - Reuters