Lecico Egypt Sae · EGX:LCSW
Lecico Egypt Sae — Q2 2014 Earnings Presentation
19 slides from Lecico Egypt Sae's earnings presentation, August 2014
Slide 1: Second Quarter 2014 Results Presentation
y,) (ee Seep tian Exporter econd Quarter 2014 Results Presentation ») August 2014 = 4
Slide 2: Corporate Summary
Corporate Summary
Slide 3: Introduction: An Egyptian exporter
Introduction: An Egyptian exporter Lecico Egypt S.A.E. – one of the world’s largest sanitary ware producers and a large tiles producer – was founded in 1959 and has been majority owned by the Gargour family since 1969 Kfarchima The company has a global competitive advantage making Established 19
Slide 4: Corporate Profile
Corporate Profile
Slide 5: Investment case
Investment case Experience Regional leadership Growing exports Significant cost advantage •Brand with over 50 years of history • Sanitary ware market leader in •c 55% of sanitary ware is exported • USD 14.60/piece cost (40% of peers) Egypt and Lebanon •SW exports 2.5% CAGR (2004-13) • c USD 1.50/pie
Slide 6: Growing exports
Growing exports Growth in group’s exports Lecico’s total export volumes (sanitary ware) Egypt’s leading sanitary ware exporter • Lecico exports c53% of its sales vs. 20% for local peers • Lecico sells to over 50 countries (including OEM sales) • Approximately 24% of exports (13% of sanitary ware sal
Slide 7: Significant cost advantage
Significant cost advantage International cost advantage Lecico produces sanitary ware at an all-in average cost of US$14.60/piece – In Egypt, manufacturing cost averages US$11.14/piece of sanitary ware – The difference reflects higher packing costs for EU-destined exports and significantly higher in
Slide 8: Cost increases 2014
Cost increases 2014
Slide 9: Energy price increases add LE 200 million in costs
Energy price increases add LE 200 million in costs In July, the government announced an massive increase in energy prices which will have a profound effect on Lecico’s financials: Item Increase Impact Natural Gas 133% from USD 3.0/mbtu to USD 7.0/mbtu 70% of energy costs, energy is 20% of cogs Ele
Slide 10: Lecico enacting significant price increases
Lecico enacting significant price increases On average Lecico needs around a 15% price increase to cover the cost inflation – By segment we need a 9% increase in sanitary ware and a 20% increase in tiles average group consolidated prices – This would only absorb costs and would still result in low
Slide 11: Financial overview
Financial overview
Slide 12: Profit and loss
Profit and loss Net sales Cost of sales breakdown (1H 2014) EBIT Net Profit * * = 2013 net profit excludes write-off for France 12
Slide 13: Quarterly P&L Trends
Quarterly P&L Trends Net sales Gross profit* EBIT* Net Profit* * = 4Q 2013 net profit excludes write-off for France 13
Slide 14: Segmental analysis
Segmental analysis Sanitary ware – sales volumes and revenue Sanitary ware – selling price and cost per piece Sanitary ware – gross profit and margin Tiles – sales volumes and revenues Tiles – selling price and cost per sqm Tiles – gross profit and margin 14
Slide 15: Quarterly Segmental trends
Quarterly Segmental trends Sanitary ware average price, cost and profit per piece Sanitary ware sales volume Tile Average Price, Cost and Profit per sqm Tile sales volume 15
Slide 16: Balance sheet and cash flow
Balance sheet and cash flow Working capital Returns and leverage Capital expenditures 2014e 16
Slide 17: Share performance and data
are performance and data rm PET a
Slide 18: Shareholding structure and performance
Shareholding structure and performance Liquidity has moved to local share and improved Lecico share price Lecico valued at a market cap of US$ 111 million with a 51% free float – All activity is in the local share although a GDR does exist – Local share trades US$ 65,200 per day and on 91% of trad
Slide 19: Thank you
Thank you For additional information, please contact: Taher G. Gargour Telephone: +203 518 0011 Fax: +203 518 0029 E-mail: [email protected] Visit our website at: www.lecico.com Forward-looking statements: This presentation may contain certain “forward-looking statements”, relating to Lecico Egypt