In a statement to Daily News Egypt, Mohamed Ebeid, CEO of EFG-Hermes, said that international promotion rounds for the 20% stake in Alexandria Containers and Cargo Handling are still in their early stages. He added that his company targets promotion and handling across 13 countries, topped by the United States, Saudi Arabia, the UAE, Kuwait, Oman, Jordan, Pakistan, and Kenya. EFG-Hermes has a huge network of over 102,400 investors from North America, Europe, the Middle East, and Africa.
He pointed out that the Alexandria Container and Cargo Handling company is still in the stage of legal preparations and procedures which is expected to be completed soon in preparation for the expansions of the promotional campaigns. Therefore, it is not possible at the moment to judge the promotional campaigns because a lot of time would be needed before announcing their results. The company has already started to promote the offering, especially as its ownership structure includes a number of Arab and foreign investors, and the company is always present in foreign conferences to promote the offering.
The offering of the company is handled by Citibank alongside the Hermes Group. The Minister of Public Enterprise Sector, Hisham Tawfik, said that Alexandria Container and Cargo Handling will soon be offered in the Egyptian Exchange (EGX), but that the investment bank is still in the process of handling the offering measures and will determine its date, pointing out that the conditions of the EGX and trading will have a role in determining the date of the offering, as it is difficult to offer the company if the performance of market indices fell significantly and trading dropped in large amounts.
Tawfik previously said that the expected proceeds from the 20% offering will range between EGP 7bn and EGP 8bn.
The contracting company concerned with the implementation of the expansion of berth 96 of the Alexandria Container has approached delivering the first phase, which will take place in August. The phase includes 400 metres of the project, and the investment of the project is estimated to be EGP 480m. Transit revenues are expected to increase by 10% between 900,000 to 1 million containers per year.
Furthermore, Alexandria Containers’ chairperson and managing director Mamdouh Tawfik, stated that the company has put forward a proposal for the dividend payout, which is currently being considered by the board.
The proposal provides for distributing a minimum of 70% of annual profits, while taking into consideration the market conditions, growth plans, maintaining a healthy liquidity balance, and any effective restrictions or contractual obligations.
Additionally, any excess cash liquidity above the prescribed capital and liquidity levels (which change with time) may be distributed as dividends to shareholders, unless such liquidity is required for other developmental purposes.
For his part, an official source at Alexandria Container and Cargo Handling Company said that his company will be implementing huge expansions during the upcoming period, which would support its position in the process of offering, noting that about EGP 380.7m were invested in the expansion of the company, during the period from July 2018 until the end of last month. This includes supplying two giant cranes worth EGP 233.5m, as well as the process of deepening berth 96 with investments worth EGP 20.5m, in addition to supplying 11 bulldozers worth EGP 16.8m, as well as other processes of repair and replacement and renovation.
The source added that his company has decided to add storage to the activities of the company, inside and outside the ports of Alexandria and Dekheila, in addition to transporting to and from the port and custom clearance works. He expected the storage activity to start storage before the end of this year.
Alexandria Container and Cargo Handling achieved sales revenues from July 2018 to the end of last month worth EGP 2.6bn, while the cost of sales amounted to EGP 860.7m for the same period. The company achieved a total profit of EGP 1.75m.
The financial Indicators of the company revealed that its profits declined by 21.6% during the first nine months of the current fiscal year, recording EGP 1.34bn compared to EGP 1.71bn year-over-year.
For its part, Beltone Research has determined that the fair value of the company’s share to be EGP 19.25 pounds per share and recommended buying the stock.
The company’s capital is estimated to be EGP 744.8m, distributed on 148.9m shares at a nominal value of EGP 5 per share. The Holding Company for Maritime and Land Transport owns 55.78% of the company’s ownership structure, while Alexandria Port Authority owns 40%. There are minor shares distributed to the United Arab Shipping Company and free trade shares.