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Egypt / Materials / Q4 2020/21 Results
12M PT: EGP26.0 (+36%)
Investment Rating: Overweight | Risk Rating: Medium
A strong earnings beat on multiple factors: Abu Qir Fertilizers [ABUK] has managed to achieve in 2020/21 top line of EGP8.8bn (+3.3% vs. Prime Research estimates “PRe”), achieving an annual growth of 12.2%. Consequently, pretax income reached EGP4.3bn (+2.8% vs. PRe). However, a lower effective tax rate of 19% resulted in relatively a wider beat in net earnings, recording EGP3.5bn (+8.0% vs. PRe). ABUK managed to achieve a strong y/y earnings growth of 30%, capitalizing on robust urea prices during H2 2020/21. ABUK managed to enrich its margins, with GPM registering 45.5% in 2020/21 (+8pp y/y, -50bps vs. PRe).
Mohamed Saad
Senior Equity Analyst
T +202 3300 5719