Alert on Q3 2013 – Maintaining an ACCUMULATE on Ezz Steel on easing macroeconomic and political risks

We maintain an ACCUMULATE rating on Ezz steel, revising our target price up to EGP 19.78 per share on easing levels of political tensions and economic uncertainties. Revenues increased by 7.7% y-o-y to reach EGP 15.98 billion up to September 2013, supported by strong sales volumes and average selling prices. Moreover, Ezz production costs dropped to 88.4% of sales during the first nine months of 2013 from 91.6% a year earlier, driving the company’s gross profit by 48.7% up to EGP 1.8 billion with a gross margin of 11.6%. Earnings followed suit, jumping to EGP 218 million from a loss of EGP 46 million recorded a year earlier, additionally lifted by higher non-operating revenues, forex gains, and interest income despite the rise in SG&A expenses and borrowing costs.

Click below for the full report:

Ezz Steel – 2013 Q3 Update

Leave a Reply

Your email address will not be published. Required fields are marked *