Orascom Construction Industries 3rd Quarter Results

Orascom Construction Industries 3rd Quarter Results
Published: 14 November 2006

Orascom Construction Industries announced consolidated revenue of EGP 11,942.1m (US$ 2076m) EBITDA of EGP 3,374.5m (US$ 586.6m) and net income of EGP 2015.3m (US$ 350.3m) for the nine months ended 30 September 2006. 
 
During the same period last year, OCI reported consolidated revenue of EGP 8,270.3m (US$1416.1m) with EBITDA of EGP 2,027.8m (US$347.2m) and net income of EGP 1274.5m (US$ 218.2m). 
 
OCI also reported record consolidated revenue of EGP 4,952.6m(US$ 860.9m) with EBITDA of EGP1331.5m (US$231.5m) and net income of EGP 806.7m (US$ 140.2m) for the third quarter ended 30 September 2006.
 
In the quarterly message to shareholders, OCI Chief Executive Officer Nassef Sawiris commented: 
 
"This third quarter reflects the impact of OCI’s enlarged portfolio of cement capacity. During the quarter, consolidated revenue grew 71%, EBITDA also rose an impressive 84% and net income increased 66%. For the nine months ended September 06, OCI showed revenue growth of 44%, EBITDA growth of 66% and a rise in net income of 58%. 
 
The OCI Cement Group reported 59% growth in EBITDA on the back of volume increases and positive market conditions. Following the successful start-up of new cement capacity in Egypt, Northern Iraq and Pakistan during July, the cement group management focused its attention on stabilising the new production equipment to reach optimal operational levels.

"The third quarter did not reflect the full impact of these new capacities. Our Cement Group capacity has grown 40% this year to reach 21Mt. During the next 10 months we expect to add 10Mt of new cement capacity to reach 31Mt," the company said in a statement.

"We have continued to pursue a strategy of vertical integration into markets which suffer from structural supply deficits in cement. Our strategy has begun to materialise with our announcement of the acquisition of a 50% stake in Group GLA, the largest independent aggregates and ready-mix concrete producer in Spain. Group GLA comes with a strong management team that has a proven track record in addition to annual operational capacities in aggregates of 5Mt along with 240Mt of reserves, ready-mix concrete capacity of 3.5Mm3 and cement milling capacity 0.6Mt. Jointly with the Cementos La Parilla clinker grinding plant north of Madrid, its previous Spanish acquisition, the combined annual cement milling capacity reaches 1.8mt in Spain.

"We will continue to investigate attractive greenfield opportunities in emerging markets, potential expansions in core subsidiaries and value-creating distribution investments in developed markets. "