Profits drop 34 pct at Egyptian cable firm Sewedy

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By Tamim Elyan / Reuters

CAIRO: Egypt’s El Sewedy Electric, the Arab world’s biggest listed cable maker, reported on Monday a 34 percent drop in its consolidated net profit for 2011, a year of political uprisings that disrupted economies in the region.

Net profit fell to LE 536.5 million ($88.82 million) from LE 816.6 million in 2010, the company said in a statement.

On an unconsolidated basis, net income slumped by 70 percent to LE 252.6 million. Turnover rose 18 percent to LE 15.17 billion.

“The results are worse than expected,” said Wafaa Baddour, an analyst at EFG-Hermes. “The revenues are normal but the margins are lower, especially for the turnkey projects. There are extra expenses and foreign currency losses.”

She said she had been expecting a net profit of LE 720 million.

Sewedy, which has production plants in Egypt and 10 other countries, also makes windfarm equipment.

Analysts say it cut some production in Egypt and Syria as political upheaval and conflict sapped demand for its wires and cables.

Sewedy shares, which have underperformed a 37 percent gain by Egypt’s benchmark EGX30 index this year, fell early in Monday’s session but then rallied to close up 1.4 percent.



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