Ezz Steel, a Cairo-based steel producer led by Egyptian businessman Ahmed Ezz, reported a profit of EGP1.217 billion ($65.5 million) in the first quarter of 2022, as it continues to benefit from the increase in steel demand and price on the global commodities market.
The resilient performance comes after the steelmaker exited a pandemic-induced loss position in 2021 to post a profit of EGP5.4 billion ($289.9 million) as it assumed an important position as a top flat steel exporter during the year, allowing it to seize significant market growth opportunities.
Despite a double-digit increase in revenue in the first quarter of 2022, Ezz Steel reported a 2.4-percent increase in profit from EGP1.187 billion ($63.9 million) in the first quarter of 2021 to EGP1.217 billion ($65.5 million) in the first quarter of 2022, according to data obtained by Billionaires.Africa from its recently published financial statement.
Ezz Steel’s revenue rose by 38.1 percent from EGP13.5 billion ($724.7 million) to EGP18.64 billion ($1 billion), boosted by sustained growth in steel prices and sales, while its gross profit increased above EGP4.6 billion ($245 million) from EGP2.87 billion ($154 million) in the first quarter of 2021.
The impact of higher operating expenses on earnings, combined with a foreign currency exchange loss of EGP1.13 billion ($60 million), led to the slower growth in earnings during the period under review.
The group’s total assets increased from EGP50.02 billion ($2.69 billion) to EGP52.2 billion ($2.8 billion) at the time of writing this report, while shareholder equity deficit narrowed to EGP7 billion ($375 million) from EGP7.7 billion ($410 million).
When accrued losses from operations cause liabilities on the balance sheet to exceed assets, a company records a deficit in shareholder equity.
Ezz Steel is the Middle East and North Africa’s largest independent steel manufacturer, with a steel production capacity of 7 million tonnes per year, which it trades and distributes through regional subsidiaries.
Ezz, who founded Ezz Steel in 1994 and owns a majority 60.7-percent stake in the company, or 329,816,198 shares, is one of the wealthiest men in the North African country and on the Egyptian Exchange.
Al Ezz Dekhelia, a subsidiary of Ezz Steel, secured regulatory approval to acquire an 18-percent stake in the Egyptian Steel Company in a deal worth EGP2.5 billion ($159.2 million) in an effort to bolster earnings and take over a significant portion of Egypt’s iron and steel market.
