Investor Presentation First Quarter 2019 24 th of April 2019 | - - PowerPoint PPT Presentation

Investor Presentation – First Quarter 2019

24th of April 2019 | Cairo, Egypt

1

Economic Overview

Yield stability still remains safeguarded despite the CBE’s decision to scrap the repatriation mechanism The decision capitalizes on improving FX, capital flows, and inflation dynamics, and bodes well with Egypt’s favorable balance of payments during 2019 19.25% 18.25% 17.25% 17.25% 17.25% 17.25% 17.25% 16.25%

07/09/2017 02/18/2018 04/01/2018 05/20/2018 06/28/2018 11/18/2018 12/27/2018 01/14/2018

Policy Rates (%) Egyptian treasury yields saw a slight decrease as domestic economic conditions pick up and the CBE cut policy rates by 100 bps in Jan 2019. Giving more room for growth in equity markets

17.7 17.9 17.9 17.9 17.8 17.9 17.9 17.9 17.9 17.7 17.5 17.3 17.2

USD/EGP (%) Foreign inflows in treasuries recorded USD1bn in Jan-19, following 8 consecutive months of outflows, signaling banks’ NFA bottomed out at USD-6.3bn in Dec-18 19.3 19.8 19.8 20.0 19.1 17.9 17.5 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Monthly Average 1-Year T-bill Yields (%)

The Group Thrives on Improved Macroeconomic Conditions

Source: CBE & Financial Regulatory Authority

4.5 7.1 11.5 2016 2017 2018 Total Micro-financing Value (EGP bn) The untapped potential of NBFS in Egypt remains to be significant despite the strong growth over the past 5 years. CI Capital has a solid presence in the leasing and microfinance sectors and has recently established a mortgage finance subsidiary. Growth was driven by an increase in demand in all leasing products including equipment, machinery and real estate The Microfinance industry is one of the most un-tapped markets in Egypt allowing total loans to reach a record EGP 11.5 billion 4.3 4.8 5.8 7.0 8.5 10.7 2013 2014 2015 2016 2017 2018 Value of Mortgage Financing (EGP bn) With the inflationary pressure on real estate prices rising, mortgage financing witnessed moderate growth over the past years due to the high interest rate environment 6.1 7.0 19.4 21.5 28.6 41.7 2013 2014 2015 2016 2017 2018 Total Leasing Contracts Value (EGP bn)

Q1 2019 Economic Fundamentals

2

2

Consolidated Results

+40.9% y-o-y

Leasing, 46.3% Micro- finance, 20.5% IB & Holding, 33.2% Leasing, 52.8% Micro- finance, 20.2% IB & Holding, 27.0%

Total Revenues

EGP728.6mn

↑34% y-o-y

Q1 2018 EGP 542.1mn

Net Operating Profit

EGP189.2mn

↑32% y-o-y

Q1 2018 EGP 143.9mn

Operating Profit Margin

26.0%

Q1 2018 26.5%

Cost-income1 (%)

19.3%

Q1 2018 20.4%

Net Profit Margin

15.8%

Q1 2018 15.1% Annualized Return on

• Av. Equity (ROAE)

20.0%

Q1 2018 Q1 2019

• 1. Cost-income is calculated as people’s cost and other SG&A divided by total revenue

Net Income By Business Line

Key Consolidated Metrics Q1 2019

EGP

81.9

mn EGP

115.5

mn

4

Q1 2019 Consolidated Results

Group Hig ighlights

Consolidated revenue grew 34.4% y-o-y given strong growth in revenues from the financing business. NBFS made up 83.5% of consolidated revenue while the investment bank along with the holding company represented the remaining 16.5%. Total operating expenses grew 35.5% y-o-y as a result of regular salary increases and an expansion in leasing and microfinance

• perations.

People’s Cost & Other SG&A represented 19.3% of revenue, down from 20.4% in the comparable year. Net operating profit grew 31.5% y-o-y on the group’s strong operational performance Net profit after tax and minority reached EGP 115.5 mn in Q1 2019, representing an annualized ROAE of 20.0%.

Summary Consolidated Income Statement Results commentary

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(EGP mn) Q1 2019 Q1 2018 % Change Consolidated Revenue 728.6 542.1 34.4% Leasing 527.5 355.8 48.2% Micro-finance 80.5 64.8 24.2% Investment Bank & Holding 120.5 121.4

• 0.7%

Operating Expenses (539.4) (398.2) 35.5% Finance cost (247.6) (167.5) 47.8%

• Dep. of finance leased assets

(151.1) (120.3) 25.6% People Cost & Other SG&A ( 140.7) (110.4) 27.5% Net Operating Profit 189.2 143.9 31.5% Net Operating Margin 26.0% 26.5% Net Profit After Tax & Minority 115.5 81.9 40.9%

Q1 2019 Consolidated Results

Statement of f Profit and Loss

Summary Consolidated Balance Statement Results commentary

Total assets grew 11.2% Q-o-Q on the back of higher lease bookings during the quarter which resulted in a larger leasing portfolio. LT & ST loans and facilities increased 23.6% and 6.1% respectively, Q-o-Q to accommodate the increase in leasing portfolio (grew 18.6% Q-o-Q).

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(EGP mn) 31-Mar-19 31-Dec-18 Settlement guaranteed fund 7.6 10.2 PP&E 128.8 125.3 Goodwill 348.8 348.8 Finance leased assets, net 6,923.9 5,838.5 Securitization difference, net 250.8 237.7 Other non-current assets 147.8 149.6 Non-current assets 7,807.7 6,710.1 Cash and cash equivalents 1,004.6 1,214.8 Debit clients 1,663.2 1,491.0 Clearing accounts – Debit 9.5 0.6 Other current assets 114.8 113.5 Current assets 2,792.0 2,819.9 Total assets 10,599.7 9,530.0 Paid-in capital 544.2 544.2 Retained earnings 869.7 826.7 Share premium reserve 858.5 858.5 Other 66.1 65.3 Shareholders’ equity (Parent company) 2,338.5 2,294.8 Shareholders’ equity (Non-controlling interest) 138.6 138.2 Total shareholder’s equity & minority interest 2,477.1 2,433.0 Long-term loans & facilities 5,575.7 4,511.3 Other Long Term Liabilities 176.5 161.7 Non-current liabilities 5,752.3 4,673.0 Short-term loans & facilities 1,526.7 1,438.6 Credit customers 315.2 268.5 Other Short Term Liabilities 528.4 716.9 Current liabilities 2,370.3 2,424.0 Total liabilities & equity 10,599.7 9,530.0

Q1 2019 Consolidated Results

Bala lance Sheet

3

Business Lines’ Performance

Leasing, 52.8% 355.8 527.5 Q1 2018 Q1 2019

New bookings

EGP1.3bn

+ 4.4x y-o-y

Net interest margin (NIM)

5.3%

Total Outstanding Leasing Portfolio Net Interest Income – EGP mn

Market Share1

13.1%

Key Gr Growth Driv Drivers

Contribution to Net Profit

Net interest income grew 41% y-o-y on a larger

• utstanding portfolio

Corplease’s leasing portfolio grew 71% y-o-y as economic recovery continues

Leasing Revenue – EGP mn

• 1. The lasts publically available date published by the FRA for FY 2018 as Q1 2019 Results are not yet available

4.1 7.0

Q1 2018 Q1 2019

(EGP bn)

61.0 86.1 Q1 2018 Q1 2019

8

Q1 2019 Business Lines’ Performance

NBFS -

Leasing

Micro- finance, 20.2% 64.8 80.5 Q1 2018 Q1 2019

Number of branches

46

Net interest margin (NIM)

37.7%

Total Microfinance Loans Outstanding Net Interest Income – EGP mn

Number of active borrowers

93.7k

+ 14.7k y-o-y

Key Gr Growth Driv Drivers

Contribution to Net Profit

The expanding loan book resulted in significant growth in net interest income Reefy capitalized on its diverse geographical presence to grow it loan book by 18% y-o-y

Microfinance Revenue– EGP mn

532.1 629.6 Q1 2018 Q1 2019

(EGP mn)

41.8 58.7

Q1 2018 Q1 2019

9

Q1 2019 Business Lines’ Performance

NBFS -

Micro-finance

IB & Holding, 27.0%

Brokerage - Market Share1

8.5%

IB Advisory Revenues EGP26.6bn

+ 9.4% y-o-y

Revenue By Line of Business - EGP mn IB & Holding Net Profit

Asset Management - AUM’s

EGP9.0bn

+ 11% y-o-y

IB& Holding Revenue – EGP mn

1. Market Share is for transactions on the main market excl. deals. Source: EGX

Key Performance Indicators

Research - Stocks Covered

110

25.4 34.1 Q1 2018 Q1 2019 66.7 6.6 26.6 19.9 119.8 Brokerage Asset Mgmt. IB Advisory Capital Markets Total

134.8 119.8

Q1 2018 Q1 2019

10

Contribution to Net Profit

Q1 2019 Business Lines’ Performance

In Investment Bank & Holding -

Financial Performance

About CI Capital CI Capital is a diversified financial services group and Egypt’s leading provider of leasing, microfinance, and investment banking products and services. Through its headquarters in Cairo and presence in New York and Dubai, CI Capital offers a wide range of financial solutions to a diversified client base that includes global and regional institutions and family offices, large corporates, SMEs, and high net worth and individual investors. CI Capital leverages its full-fledged investment banking platform to provide market leading capital raising and M&A advisory, asset management, securities brokerage, custody and research. Through its subsidiary Corplease, CI Capital offers comprehensive leasing solutions, including finance and

• perating leases, and sale and leaseback, serving a wide range of corporate clients and SMEs. In

addition, CI Capital offers microfinance lending through Egypt’s first licensed MFI, Reefy.

Share Information IR Contacts +20 (02) 3331 8154 Investor.relations@cicapital.com CI Capital Holding, 64-66 Mohie El Din AboulEzz St., Dokki, Egypt

Tic icker: CICH.CA; CICH EY EY Sha Shares s Outstanding: 54 544,1 4,184 84,03 033 Paid aid-In Cap apital: EGP 54 544,18 4,184,0 ,033

11

Stock Information

This announcement contains certain forward-looking statements. A forward-looking statement is any statement that does not relate to historical facts and events, and can be identified by the use of words and phrases like “according to estimates”, “anticipates”, “assumes”, “believes”, “could”, “estimates”, “expects”, “intends”, “is of the opinion”, “may”, “plans”, “potential”, “predicts”, “projects”, “should”, “to the knowledge of”, “will”, “would”, “annualized” or, in each case their negatives or other similar expressions, which are intended to identify a statement as forward-looking. This applies, in particular, to statements containing information on future financial results, plans, or expectations regarding the Company’s business and management, the Group’s future growth or profitability and general economic and regulatory conditions and other matters affecting the Group. Forward-looking statements reflect the current views of management of future events and are based on management’s assumptions and involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Group to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. The occurrence or non-occurrence of an assumption could cause the actual financial condition and results of operations of the Group to differ materially from, or fail to meet expectations expressed

• r implied by, those forward-looking statements. The Company’s business is subject to a number of risks and uncertainties that could also cause a forward-

looking statement, estimate or prediction to become inaccurate. These risks include fluctuations in the prices of energy, raw materials or employee costs required by the operations of the Group, its ability to retain the services of certain key employees, its ability to compete successfully, changes in political, social, legal or economic conditions in Egypt, worldwide economic trends, global and regional trends in the industry, the impact of war and terrorist activity, inflation, interest rate and exchange rate fluctuations and the ability of management to identify accurately and in a timely manner future risks to the business

• f the Group and manage the risks mentioned above. Accordingly, investors should not rely on the forward-looking statements in this announcement. None of

the Group, its management or CI Capital gives any assurance regarding the future accuracy of the opinions set forth in this announcement or as to the actual

• ccurrence of any predicted developments. After the date of this announcement, none of the Group or its management assumes, and each of the Group and

its management expressly disclaim, any obligation, except as required by law and the listing rules of the EGX, to update any forward-looking.

Disclaimer