In a challenging start to the year, GB Corp., the Cairo-based automaker owned by the family of late Egyptian auto tycoon Raouf Ghabbour, experienced a significant decline in its earnings in the first three months of 2023.
The company’s profit fell below the $3.5-million mark during the first quarter of 2023, slumping by more than 70 percent compared to the same period last year.
Previously known as GB Auto, the group underwent a rebranding effort to enhance shareholder value. However, its financial report for the first quarter of 2023 revealed a 71.5-percent drop in profit, from EGP 365.64 million ($11.82 million) to EGP 103.95 million ($3.36 million) compared to Q1 2022.
This decline in earnings can be attributed to a significant drop in revenue. For example, GB Corp’s latest financial report disclosed revenue of EGP 4.74 billion ($153.3 million) in Q1 2023, reflecting a sharp 39-percent plunge from the EGP 7.84 billion ($253.6 million) reported during the same quarter last year.
Founded in 1985 by Ghabbour, GB Auto has emerged as a prominent automobile distributor and assembler in the Middle East and North Africa. Under his guidance, the company experienced remarkable growth and success.
The Ghabbour family presently holds a 62.9-percent stake in the automaker, solidifying their position as one of the wealthiest investors on the Egyptian Exchange.
The recent rebranding initiative by GB Corp aimed to unify its subsidiaries, including GB Auto, GB Capital, GB Logistics, GB Ventures, GB Academy, and the Ghabbour Foundation for Development. The goal was to provide significant value to shareholders by increasing dividend payouts through higher earnings and improved asset quality.
Despite the challenging financial results, GB Corp., under the leadership of CEO Nader Ghabbour, saw a notable increase in its total assets during the period under review.
As a result, the company’s total assets surged from EGP34.61 billion ($1.12 billion) at the end of its 2022 fiscal year to EGP37.47 billion ($1.22 billion) at the end of Q1 2023.