The net profit of Ezz Steel increased by 23% to about EGP 6.6bn in 2022 compared to EGP 5.4bn during 2021.
According to the company’s business results report, which was reviewed by Daily News Egypt, the company’s net sales increased by 24% to EGP 83.9bn in 2022, compared to EGP 67.8bn in 2021.
The company’s exports declined to $797m in 2022 from $1.3bn in 2021.
In the business results report, the company explained the decline in export sales to an increase in the demand for iron locally, which made the company resort to filling the local need at the expense of exports.
It added that the domestic consumption of reinforcing steel grew over the past year by 8% to record 7.8 billion tonnes, compared to 7.3 billion tonnes in 2021.
It revealed that the company is seeking during the current year to increase its exports to provide dollar liquidity that suffices its import needs of raw materials and general materials that go into the production process.
The company added that the Central Bank of Egypt raised interest rates more than once to keep pace with global changes, expecting that the greatest impact of the high interest rate environment will be reflected in the company’s income statement for the first quarter of this year.
It pointed out that the interest rate rise, along with the cancellation of the 8% low interest rate facilities initiative for industry, constitutes a great burden on manufacturers and consumers alike, stressing its commitment as a group to increase its exports to support the national economy.
In a related context, the company indicated that global crude steel production decreased by 3.9% in 2022 to reach 1.8 billion tonnes, compared to 1.96 billion tonnes in 2021, due to the decline in China’s production by 1.7% during the period, whose production represents about 54% of the total global production of iron ore.
The company confirmed experts’ expectations that the global steel production market will try to stabilize the current production volume of 1.8 billion tonnes, which was already recorded in 2022.
It expects global steel production to recover in a later period if inflation is controlled, but it will witness limited growth.
It added that high global inflation negatively affects consumption, especially in the United States, Europe and Japan.
It explained that expectations indicate an increase in the demand for iron during the current year by Turkey, after the repercussions of the earthquake and its need for reconstruction.
Domestically, Ezz Steel believes that the consumption of reinforcing steel and steel in Egypt began to suffer from high inflation rates and an increase in prices as a result of the depreciation of the Egyptian pound against the US dollar.