Investor Presentation Second Quarter 2019 31 st of July 2019 | - - PowerPoint PPT Presentation

Investor Presentation – Second Quarter 2019

31st of July 2019 | Cairo, Egypt

1

Economic Overview

55.3 37.0 37.3 46.5 37.3 37.0 19.4% 17.9% 17.5% 17.2% 17.3% 17.3% 2.0% 7.0% 12.0% 17.0% 22.0% 0.0 10.0 20.0 30.0 40.0 50.0 60.0 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 T-bills Rate

Amount Auctioned (EGP bn) Average Yeilds (%)

4.5 7.1 11.6 12.7 1.8 2.3 2.8 2.9

• 2.0

4.0

• 5.0

10.0 15.0 2016 2017 2018 Q1 2019 Micro-finance

O/S Portfolio (EGP bn) Active Borrowers (Million)

In June 2019 prices of fresh vegetables declined by 11.16 %, while prices of fresh fruits increased by 15.65 %, respectively. Together they contributed by negative 0.99 percentage points to monthly headline inflation Inflationary measures where well contained falling within the CBE’s target by the end of the second quarter of 2019 ,despite the supply shock in fruits and vegetables in the beginning of the year. T-bill yields remained relatively un-changed since February after the commencement of the 2019 monetary easing cycle.

The Group Thrives on Improved Macroeconomic Conditions

Source: CBE & Financial Regulatory Authority

The non-bank financial servces industry commenced the year by reaping the benefits of its un-tapped potential witnessing solid growth for the first four months in 2019 in all sectors 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 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 12.7 billion

H1 2019 Economic Fundamentals

2

9.4% 14.1% 13.0% 14.2% 14.4% 12.7% 6.4% 7.8% 8.1% 8.9% 9.2% 8.6% 17.25% 16.25% 16.25% 16.25% 16.25% 16.25%

Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19

Policy Rates & Inflation

Annual Headline Inflation Monthly Core Inflation Policy Rates

Yield stability still remains safeguarded despite the CBE’s decision to scrap the repatriation mechanism and is expected to remain as such until the next phase of the CBE’s monetary easing cycle 4.1 5.0 4.6 2.4 280 259 216 250

• 100

200 300 0.0 2.0 4.0 6.0 Jan-19 Feb-19 Mar-19 Apr-19 Leasing

Total Contract Value (EGP bn)

• No. of Contracts

4.7 4.8 4.9 5.1 0.9 0.6 0.7 1.0 0.0 0.5 1.0 1.5 4.4 4.6 4.8 5.0 5.2 Jan-19 Feb-19 Mar-19 Apr-19 Mortgage Finance

O/S Portfolio

• No. of Contracts (000's)

2

Consolidated Results

+38.8% y-o-y

Total Revenues

EGP1.1bn

↑35% y-o-y

H1 2018 EGP 848.9mn

Net Operating Profit

EGP343.9mn

↑31% y-o-y

H1 2018 EGP 263.2mn

Operating Profit Margin

30.0%

H1 2018 31.0%

Cost-income1 (%)

23.3%

H1 2018 28.7%

Net Profit Margin

20.5%

H1 2018 20.0% Annualized Return on

• Av. Equity (ROAE)

17.6%

H1 2018 H1 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 H1 2019

EGP

149.7

mn EGP

207.7

mn

4

Group Hig ighlights

H1 2019 Consolidated Results

Leasing, 45% Micro- finance, 25% IB & Holding, 30% Leasing, 52% Micro- finance, 22% IB & Holding, 26%

Consolidated revenue grew 34.9% y-o-y given strong growth in revenues from the financing business. NBFS made up 81.3% of consolidated revenue while the investment bank along with the holding company represented the remaining 18.7%. Total operating expenses grew 36.9% y-o-y due to an increase 56.4% in financing costs y-o-y to reach EGP 535 million to accommodate the group’s robust

• perational

expansion in its financing business. People’s Cost & Other SG&A represented 23.3% of revenue, down from 28.7% in the comparable year. Net operating profit grew 30.6% y-o-y on the group’s strong operational performance Net profit after tax and minority reached EGP 207.7 mn in H1 2019, representing an annualized ROAE of 17.6%.

Summary Consolidated Income Statement Results commentary

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(EGP mn) H1 2019 H1 2018 % Change Consolidated Revenue 1,145.4 848.9 34.9% Leasing 768.2 454.7 68.9% Micro-finance 163.5 140.1 16.8% Investment Bank & Holding 213.7 254.2

• 15.9%

Operating Expenses (801.5) (585.7) 36.9% Finance cost (535.0) (342.1) 56.4% People Cost & Other SG&A (266.5) (243.6) 9.4% Net Operating Profit 343.9 263.2 30.6% Net Operating Margin 30.0% 31.0% Net Profit After Tax & Minority 207.7 149.7 38.8%

H1 2019 Consolidated Results

Statement of f Profit & Loss

Summary Consolidated Balance Statement Results commentary

Total assets grew 24.5% since Dec-18

• n the back of higher lease bookings

during the quarter which resulted in a larger leasing portfolio. LT & ST loans and facilities increased 35.1% and 27.9% respectively since Dec-18 to accommodate the increase in financing business portfolio (grew 28.4% since Dec-18).

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(EGP mn) 30-June-19 31-Dec-18 Settlement guaranteed fund 8.3 10.2 PP&E 129.3 125.3 Goodwill 348.8 348.8 Lease Receivables 6,605.0 4,965.8 Securitization difference, net 263.1 237.7 Other non-current assets 23.1 16.7 Non-current assets 7,377.7 5,704.5 Lease Receivables 1,230.4 866.4 Cash and cash equivalents 1,342.5 1,214.8 Debit clients 1,793.9 1,635.2 Clearing accounts – Debit 15.7 0.6 Other current assets 107.3 113.5 Current assets 4,489.9 3,830.5 Total assets 11,867.5 9,535.0 Paid-in capital 544.2 544.2 Retained earnings 964.5 829.3 Share premium reserve 858.5 858.5 Other 63.2 65.3 Shareholders’ equity (Parent company) 2,430.4 2,297.3 Shareholders’ equity (Non-controlling interest) 151.6 138.6 Total shareholder’s equity & minority interest 2,582.0 2,435.9 Long-term loans & facilities 6,094.2 4,511.3 Other Long Term Liabilities 181.8 164.8 Non-current liabilities 6,276.0 4,676.0 Short-term loans & facilities 1,840.6 1,438.6 Credit customers 528.7 268.5 Other Short Term Liabilities 640.2 715.9 Current liabilities 3,009.5 2,423.0 Total liabilities & equity 11,867.5 9,535.0

H1 2019 Consolidated Results

Bala lance Sheet

CI Capital Holding for Financial Investments has adopted the new Egyptian Accounting Standard EAS 49 in relation to its leasing subsidiary effective from Q2 2019. The new EAS 49 brings lease accounting more in line with IFRS 16 and requires changes and restatement to prior periods’ figures with implications

• n

both the consolidated income statement and balance sheet. Comparative and Q1 2019 financials have also been restated to comply with the new standard.

3

Business Lines’ Performance

454.7 768.2 H1 2018 H1 2019

New Bookings

EGP2.5bn

+ 49.2% y-o-y

Net Interest Margin (NIM)

5.1%

Total Outstanding Leasing Portfolio Net Interest Income – EGP mn

Market Share1

21.2%

Key Gr Growth Driv Drivers

Contribution to Net Profit

Net interest income grew 41% y-o-y on a larger outstanding portfolio Corplease’s leasing portfolio grew 53% y-o-y as economic recovery continues

Leasing Revenue – EGP mn

• 1. The lasts publically available date published by the FRA from Jan 2019 to May 2019

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H1 2019 Business Lines’ Performance

NBFS – Leasing

Leasing, 52%

5.3 8.1

H1 2018 H1 2019 127.8 180.3 H1 2018 H1 2019

140.1 163.5

H1 2018 H1 2019

Number of Branches

50

Monthly Disbursements (Average)

EGP95.4mn

Total Microfinance Loans Outstanding Net Interest Income – EGP mn

Number of Active Borrowers

98.5k

+ 9.5k 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 11% y-o-y

Microfinance Revenue– EGP mn

9

H1 2019 Business Lines’ Performance

NBFS – Micro-finance

Micro- finance, 22% 596.3 660.0

H1 2018 H1 2019 91.4 118.0 H1 2018 H1 2019

266.8 212.8

H1 2018 H1 2019

Brokerage - Market Share1

9.7%

IB Advisory Revenues EGP33.7mn

• 37.9% y-o-y

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

Asset Management - AUM’s

EGP9.1bn

+ 10% y-o-y

IB & Holding Revenue – EGP mn

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

Research - Stocks Covered

114

10

Contribution to Net Profit H1 2019 Business Lines’ Performance

In Investment Bank & Holding

IB & Holding, 26%

Key Performance Indicators

124.2 19.3 33.7 35.6 212.8 Brokerage Asset Mgmt. IB Advisory Capital Markets & Treasury Total

43.6 57.0

H1 2018 H1 2019

About CI Capital Holding for Financial Investments CI Capital Holding for Financial Investments 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 Holding for Financial Investments 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 Holding for Financial Investments 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 Holding for Financial Investments offers comprehensive leasing solutions, including finance and operating leases, and sale and leaseback, serving a wide range of corporate clients and SMEs. In addition, CI Capital Holding for Financial Investments offers micro-finance lending through Egypt’s first licensed MFI, Reefy.

Share Information IR Contacts +20 (02) 3331 8154 Investor.relations@cicapital.com CI Capital Holding for Financial Investments , 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 In 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 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 of 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 Holding for Financial Investments 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