Final Project 2021

Financial Analysis for ELSEWEDY ELECTRIC
Project

for PRMG – 030
Submitted to: Dr.Ahmed Salah
Submitted by: Wael Mohamed Rawy Hussien
Student ID : 700090888

Financial Analysis for ELSEWEDY ELECTRIC 1
Index:
Contents Page
Introduction for Construction industries in Egypt……………………………………2
Introduction to the company and their history……………………………………….3

Discussion about other competitors in the market……………………………………4
1- Liquidity Group …………………………………………………………………...... 5
1‐A Current Ratio ………...………………………………………………... 5
1‐B Quick Ratio ………...………………………………………………..... 6
2- Activity Group …………………………………………………………………….. 7
2‐1 Average Collection Period ……..…………………………………………………...... 7
2‐2 Inventory turnover Ratio ………………………………………....... 8
2‐3 Fixed assets turnover Ratio ………………………………………....... 9
2‐4 Total assets turnover Ratio ………………………………………....... 10
3- Profitability Group………………………………………………………………… 11
3‐1 Net profit margin Ratio ………………...…………………..………... 11
3‐2 Return on assets …………………………………………..... 12
3‐3 Return on equity …………………………………………............. 13
4- Debit Ratios ………………………………………………………………..... 14
4‐1 Debit to assets Ratio …………………………...……………………………... 14
4‐2 Time interest earned Ratio ……………………………………………...... 15
5- Evaluation Ratio 16
5‐1 P/E ……………………………………...……………………………....................................................................16
6- Additional Ratios ( 3 additional ratios) 17 ‐ 19
Conclusion for Financial Ratios …………………………………………………… 20
Appendix …………………………..………………………………………………….……. 21
Financial Statements .................................................................................................................................
21

1

I) Introduction to the construction industry in Egypt
The Egyptian construction sector performed strongly during FY 2019, contributing to 6.2% of
Egypt’s GDP. As a matter of fact, the sector alone grew by 8.8% in the past fiscal year, against a
growth rate of 10% in FY 2018.
Expanding government investments towards environmentally sustainable, energy-efficient

infrastructure is propelling the growth for Egypt Construction and Infrastructure sector.
Developing interest for Building Information Modeling, Modular development, and building
materials industry is being seen over the Egypt Construction and Infrastructure market. The global
trends in urbanization and industrialization, investments in rails, roadways, ports, power, and
utilities all around the world and Egypt are propelling the growth of the construction sector.
The total development venture pipeline in Egypt incorporating all uber projects with a value above
USD 25 million – stands at (USD 392.4 billion). The pipeline, which incorporates all projects from
pre-planning to execution, is slanted towards late-stage development projects, with 70% of the
project pipeline by value in the pre-execution and execution stages as of August 2019.
The Egypt construction market covers the growing construction projects in different sectors, like
commercial construction, residential construction, industrial construction, infrastructure
(transportation construction), and energy and utility construction.
The construction industry is expected to continue to expand strongly over the forecast period
(2020–2025), with many investments in infrastructure, residential, and energy projects continuing
to drive growth. The focus on the improvement of the transport framework and the development
of sustainable, affordable housing units will be key growth drivers.
The plans of the government to increase the share of sustainable power source in the nation's total
energy from 3.0% in 2016 to 20.0% in 2022 and 37.0% by 2035, will be one of the main factors
to drive the growth of energy and utilities construction market over the forecast period.
To develop urban transport infrastructure, the European Investment Bank (EIB) endorsed credit of
USD 212.3 million to support public transport in Greater Cairo. The project aims to develop
sustainable transport infrastructure, diminish urban blockage, boost the mobility of people and
services, and bolster economic growth.
2

The government's efforts to balance supply and demand for affordable housing will spur the
growth of residential construction market over the forecast period. The construction of a new
capital city to the east of Cairo, in order to advance financial development, create employment,
attract the foreign investments by the Ministry of Housing, Utilities and Urban Development Egypt
(MoH) is one of the major factor to drive the growth of construction and infrastructure sector
during the forecast period. In March 2017, the Ministry of Transportation of Egypt announced
plans to attract investments worth USD15.0 billion in new rail and metro projects across the
country. Of the total investment, USD14.0 billion will be spent on three high-speed rail line
projects.
2) Introduction to ELSEWEDY ELECTRIC and their history
ELSEWEDY ELECTRIC is one of the leading energy solution and infrastructure

Providers. ELSEWEDY started as a manufacturer of electrical cables in Egypt 80 years ago under
the name of ELSEWEDY cables till it became one of the top ten cables manufacturer all over the
world. ELSEWEDY expanded his business in Egypt to all African countries and middle east
countries also increase his production facilities to cover the complete range of required power and
energy products. ELSEWEDY ELECTRIC has evolved into a global provider of energy, digital
and infrastructure solutions with a turnover of 46.4B EGP in 2020. Listed on the Cairo stock
exchange since 2006. ELSEWEDY Electric has been recognized among the top 100 companies in
the Middle East by Forbes, due to its sector-based contribution to significantly boost local
economic growth.
ELSEWEDY ELECTRIC Company “previously named EL SEWEDY CABLES “is an Egyptian
joint stock company, established under the investment low no.08 of year 1997. The company
decided to change its name from ELSEWEDY cables to ELSEWEDY electric on 4/10/2010 to
match the company purpose to establish and operate production facilities not only for cables but
also for transformers, accessories, copper & aluminum coated products. In addition to designing,
building, managing, operating and maintaining power generation units, transmission lines and
power networks. The consolidated financial statement included the holding company and its
subsidiaries.
3

Now, ELSEWEDY ELECTRIC operates in five key business sectors: Wire & Cable, Electrical
Products, Engineering & Construction, Smart Infrastructure and Infrastructure Investments.
At the heart of ELSEWEDY ELECTRIC approach is an all-in-one integrated Engineering,

Procurement & Construction (EPC) service which enables us to deliver even the most complex
projects on time with high quality standards and within budget.
ELSEWEDY ELECTRIC became one of the most important pioneers of energy management and
efficiency. As part of the company commitment to sustainability ELSEWEDY ELECTRIC has
established green energy and smart metering projects across Africa, the Middle East and Eastern
Europe. A vital part of our mission is ensuring that the communities where we operate develop and
flourish.
Our growth has been based on sound financials and a commitment to hiring talented
individuals. As well as empowering businesses and communities, we have been a major
contributor to the Egyptian, African and Middle Eastern economies.
ELSEWEDY ELECTRIC has 22 production facilities, 48 international offices and working in 110
markets all over the world. The company delivered 23GW/H until 2019 through 15K employee.
20% of the employees are engineers, 22% of the employees are female and 70% of the manpower
are below age of 40 years old.
3) Discussion about other competitors in the market

Although there are a lot of companies working in the construction industry, there are only few
companies that can be considered as real competitors to ELSEWEDY ELECTRIC in the sector of
power plant such as Arab Contractors, Orascom construction in the field of generation stations
whoever Arab Contractors used to contact ELSEWEDY ELECTRIC as a subcontractor who can
cover the electrometrical part in the power plant and power station construction.
In the sector of transmission lines and power station construction there are many players in the
market like Madkour contracting, Energya, Giza cables, XD –EGYMAC, TAQA , Alstom ,
SIEMENS , ABB and GE but still ELSEWEDY ELECTRIC in the most important key player
among others as they are manufacturer , developer and EPC contractor .

4

4)Calculations of Financial ratios based on official financial statements

1- Liquidity Ratios:
Measure the capability of company to meet its short-term Obligations.
1.1 - Current Ratio.
Current Ratio = Current Assets / Current liabilities
Year 2017 2018 2019
Current Assets 32319448375 36215611778 40361739187
Current Liabilities 26179244306 27930233207 31860767335
Current Ratio 1.2345 1.2966 1.2668
I.A. 1.2659 1.2659 1.2659
I.A : was calculated based on the average of the 3 years from 2017 till 2019
Current Ratio Trend Curve
1.31
1.3
1.29
1.28
Ratio Value
1.27
1.26
1.25
1.24 Current Ratio
1.23 Average IA
1.22
1.21
1.2
2017 2018 2019
Current Ratio 1.2345 1.2966 1.2668
Average IA 1.2659 1.2659 1.2659
Year

Trend Curve Analysis:
ELSEWEDY raised its current assets to meet its short‐term obligations not only that but have also a good
liquidity enable it to compete other companies.
Weakness and Strength Points:
From middle of year 2017 till the end of year 2019 the co. had good assets to cover its obligations,
This value was enhanced on 2018& 2019 compared to 2017.
5

1.2 - Quick Ratio.
Quick Ratio = Current Assets ‐ Inventories / Current liabilities
Year 2017 2018 2019
Current Assets 32319448375 36215611778 40361739187
Current Liabilities 26179244306 27930233207 31860767335
Inventories 7818948365 9334088479 9148634900
Current Ratio 0.9358 0.9624 0.9796
I.A. 0.9593 0.9593 0.9593
Quick Ratio
0.99
0.98
0.97
0.96
Ratio
0.95
0.94 Current Ratio
0.93 I.A.
0.92
0.91
2017 2018 2019
Current Ratio 0.9358 0.9624 0.9796
I.A. 0.9593 0.9593 0.9593
Year


ELSEWEDY in 2017 was having less quick ratio due to the value of the inventory compared to the
value of current assets so the quick value was less than the average then gradually ELSEWEDY
started increasing the value of current assets with a relative decrease in the inventory.

From middle of year 2018 till the end of year 2019 was better than the company situation in 2017.
6

2 – Activity Group.
2.1 – Average Collection Period Ratio (ACP).
Average Collection Period Ratio = Account Receivable / (Sales / 360 )
Year 2017 2018 2019
Account Receivable 6 933 140 957 6 165 999 360 7 193 297 801
(Trade receivables )
Sales 42 911 112 896 42 490 563 350 46 628 791 471
ACP Ratio 58.1651 52.2412 55.5362
I.A. 55.3142 55.3142 55.3142
Average Collection Period Ratio
59.0000
58.0000
57.0000
56.0000
ACP Ratio
55.0000
54.0000
53.0000
52.0000 ACP Ratio
51.0000 I.A.
50.0000
49.0000
2017 2018 2019
ACP Ratio 58.1651 52.2412 55.5362
I.A. 55.3142 55.3142 55.3142
Year

ACP was above the average in 2017. The Ratio less than the average in 2018 however the sales
records were less than 2017 then curve started to go up again in 2019 to be higher than the
average value along with the increase in the sales records

Collection policies have to be enhanced
7

2.2 – Inventory Turn Over.
Inventory Turn Over Ratio = Sales / Inventory
Year 2017 2018 2019
Sales 42 911 112 896 42 490 563 350 46 628 791 471
Inventories 7 818 948 365 9 334 088 479 9 148 634 900
Inventory Turn 5.4881 4.5521 5.0968
Over
I.A. 5.0457 5.0457 5.0457
Inventory Turn over
6
4
Ratio
2 Inventory Turn Over
I.A.
1
0
2017 2018 2019
Inventory Turn Over 5.4881 4.5521 5.0968
I.A. 5.0457 5.0457 5.0457
Year

It seems to be stable and near the average expect year 2018.

The inventory has to be managed in a proper way to reduce its value.

8

2.3 – Fixed assets Turn Over.
Fixed assets Turn Over Ratio = Sales / fixed assets
Year 2017 2018 2019
Sales 42,911,112,896.00 42,490,563,350.00 46,628,791,471.00
Fixed assets 4,305,017,755.00 4,259,405,344.00 6,275,415,601.00
Fixed assets
9.97 9.98 7.43
turnover Ratio
I.A. 9.12 9.12 9.12
2019 statement shows the fixes assets and project under progress as one point of
value 7 485 260 488 but in the notes point 12 the projects under progress has a value
of 1 209 844 887
Fixed assets turnover Ratio
12.00
10.00
8.00
Ratio
6.00
4.00
2.00
‐
2017 2018 2019
Fixed assets turnover Ratio 9.97 9.98 7.43
I.A. 9.12 9.12 9.12
Year

It seems to be stable over 2017 & 2018 but on 2019 the company increased the value of its
fixed assets.

Strong investment has been done recently on 2019 by increasing the fixed assets
9

2.4 – Total assets Turn Over.
Total assets Turn Over Ratio = Sales / Total assets
Year 2017 2018 2019
Sales 42,911,112,896.00 42,490,563,350.00 46,628,791,471.00
Total assets 42,427,485,367.00 46,128,218,440.00 53,397,692,834.00
Total assets
turnover Ratio 1.0114 0.9211 0.8732

I.A.
0.9353 0.9353 0.9353
Total assets turn over
Ratio
1.0500
1.0000
0.9500
0.9000
0.8500
0.8000
2017 2018 2019
Total assets turnover Ratio 1.0114 0.9211 0.8732
I.A. 0.9353 0.9353 0.9353
Year

Company is investing in its assets so the total assets value increased over 2018 & 2019 and
sales values increased with a remarkable amount on 2019

Strong investment has be done in assets over 2018 & 2019 along in incensement in the sales
values on same years which is enhancing the company situation in the market.

10

3 – Profitability Group.
3.1 – Net profit margin Ratio:
Net profit margin Ratio = Net profit / Sales

Year 2017 2018 2019
Sales 42,911,112,896.00 42,490,563,350.00 46,628,791,471.00
Net income after
6,486,558,095.00 5,109,679,722.00 4,163,107,975.00
tax
Total assets
15.12% 12.03% 8.93%
turnover Ratio
I.A. 12.02% 12.02% 12.02%
Net profit margin Ratio
16.00%
14.00%
12.00%
10.00%
Ratio
8.00%
6.00%
4.00%
2.00%
0.00%
2017 2018 2019
Total assets turnover Ratio 15.12% 12.03% 8.93%
I.A. 12.02% 12.02% 12.02%
Year

There is a decrease in the profit margin on 2019 however there was an increase in the sales but
there was an investment in the assets and increase in the liabilities during the same year,

The company should take a serious step to go back to the higher levels of profit margins
11

3.2 – Return on Assets:
Return on assets Ratio = Net income / total assets

Year 2017 2018 2019
Net Profit
6,486,558,095.00 5,109,679,722.00 4,163,107,975.00
after tax
Total assets 42,427,485,367.00 46,128,218,440.00 53,397,692,834.00
Return on
15.29% 11.08% 7.80%
assets Ratio
I.A. 11.39% 11.39% 11.39%
Return on Assets
18.00%
16.00%
14.00%
12.00%
10.00%
Ratio
8.00%
6.00%
4.00%
2.00%
0.00%
1 2 3
Return on assets Ratio 15.29% 11.08% 7.80%
I.A. 11.39% 11.39% 11.39%
Year


Company used the assets to make a good income higher than the average IA during 2017 but the
curve went down later.
Weakness and Strength Points: Company has to take serious plan by managing the
assets in a better way to increase the company income compared to the assets value .

12

3.3 – Return on Equity:

Return on Equity = Net income / total equity
Year 2017 2018 2019
Net Profit after
6,486,558,095.00 5,109,679,722.00 4,163,107,975.00
tax
Total Equity 14,155,728,764.00 16,137,815,701.00 17,298,522,006.00
Return on
45.82% 31.66% 24.07%
Equity Ratio
I.A. 33.85% 33.85% 33.85%
Return on Equity
50.00%
40.00%
30.00%
Ratio
20.00%
10.00%
0.00%
2017 2018 2019
Return on Equity Ratio 45.82% 31.66% 24.07%
I.A. 33.85% 33.85% 33.85%
Year


Net income as a percentage of the owner equity was high in 2017 then started to go below the IA
value in 2018 & 2019

Company has to take serious plan to increase the net income.
13

4 – Debt Ratio:
4.1 – Debt to Assets Ratio:
Debt to Assets Ratio = total Liabilities / total assets

Year 2017 2018 2019
Total Liabilities 28,271,756,603.00 29,990,402,739.00 36,099,170,828.00
Total assets 42,427,485,367.00 46,128,218,440.00 53,397,692,834.00
Return on
66.64% 65.02% 67.60%
assets Ratio
I.A. 66.42% 66.42% 66.42%

Debt to Assets Ratio
68.00%
67.00%
66.00%
Ratio
65.00%
64.00%
63.00%
2017 2018 2019
Return on assets Ratio 66.64% 65.02% 67.60%
I.A. 66.42% 66.42% 66.42%
Year


Company assets & debts went up from 2017 till 2019. Ratio was above the average in
2017&2019 which shows is a risky situation for the company.

Company situation was risky in 2017 & 2019 as the ratio was less than the average but on 2018
the situation was much better and the risk was minimized.
14

4.2 Time interest earned Ratio:

Time interest earned Ratio = (earnings before interest & taxes ) / (interest
expenses)
Year 2017 2018 2019

Earning before
interest & 7,670,496,754.00 6,068,580,300.00 5,494,570,481.00
taxes
interest
expenses
512,376,566.00 356,959,191.00 828,359,779.00
Time
interest
14.97 17.00 6.63
earned
Ratio
I.A. 12.87 12.87 12.87
Interest expenses is part of finance expense according to the financial statement

description for example page 19/39 in 2017 financial statement
Chart Title
18.00
16.00
14.00
12.00
Ratio
10.00
8.00
6.00
4.00
2.00
0.00
2017 2018 2019
Time interest earned Ratio 14.97 17.00 6.63
12.87 12.87 12.87 1
I.A. 12.87 12.87 12.87
Year

These Ratio asses the company ability to serve its debt. This ability in 2017 7 2018 was higher
than the average but started to be less than the average on 2019 but still the company can
cover its debts easily.
15

5 – Evaluation Group:
5.1 – PE Ratio (price to earn ratio): -
PE Ratio (price to earn ratio) = Price per share / earning per share
Year 2017 2018 2019

Price per
share
14.90 17.91 11.19
Earning per
share
2.92 2.29 1.84
Price to
earn Ratio
5.10 7.82 6.08
I.A. 6.34 6.34 6.34
Price per share: https://www.zawya.com/mena/en/stock/1000444/el-sewedy-

electric/SWDY.CA/
PE Ratio
9.00
8.00
7.00
6.00
Ratio
5.00
4.00
3.00
2.00
1.00
0.00
2017 2018 2019
Price to earn Ratio 5.10 7.82 6.08
I.A. 6.34 6.34 6.34
Year

Price per share reflect the amount the investors paid in LE to earn each LE so the value in 2018 was
higher than the average value and also higher than 2017 & 2019 which means the investors paid more.
2017 & 2019 are much better than 2018
16

6 – Additional Ratios Group:

6.1 – Net working capital to sales Ratio
Net working capital to sales Ratio ={ ( current assets – current liabilities ) / Sales }
Year 2017 2018 2019

Current
Assets 32,319,448,375.00 36,215,611,778.00 40,361,739,187.00
Current
Liabilities 26,179,244,306.00 27,930,233,207.00 31,860,767,335.00

Sales
42,911,112,896.00 42,490,563,350.00 46,628,791,471.00
Net working
capital to 14.31% 19.50% 18.23%
sales Ratio
I.A. 17.35% 17.35% 17.35%

Net working capital to sales Ratio
25.00%
20.00%
15.00%
Ratio
10.00%
5.00%
0.00%
2017 2018 2019
Net working capital to sales
14.31% 19.50% 18.23%
Ratio
I.A. 17.35% 17.35% 17.35%
Year

This Ratio represents the net working capital to sales also represent the company liquid assets relative
to its need for liquidity to achieve the sales. There is a big enhancement in the company situation over
2018 & 2019 relatively to 2017.
17

6.2 – Gross profit margin Ratio :
Gross profit margin Ratio = Gross profit / Sales

Year 2017 2018 2019
Gross
9,044,228,654.00 7,199,168,175.00 8,193,999,771.00
Profit
Sales 42,911,112,896.00 42,490,563,350.00 46,628,791,471.00
Gross
profit
21.08% 16.94% 17.57%
margin
Ratio
I.A. 18.53% 18.53% 18.53%

Chart Title
25.00%
20.00%
15.00%
Ratio
10.00%
5.00%
0.00%
2017 2018 2019
Gross profit margin Ratio 21.08% 16.94% 17.57%
I.A. 18.53% 18.53% 18.53%
Year

Company gross profit ratio is going below the average in 2018 & 2019 duo to
reduction in the sales records. Company should implement serious plan to
increase the sales and reduce the sales expenses.

18

6.3 – Current assets to fixed assets Ratio:

Current assets to fixed assets Ratio = Current Assets / Fixed Assets

Year 2017 2018 2019

Current Assets
32,319,448,375.00 36,215,611,778.00 40,361,739,187.00

Fixed assets
4,305,017,755.00 4,259,405,344.00 6,275,415,601.00
Ratio 7.51 8.50 6.43
I.A. 7.48 7.48 7.48
Current to Fixed assets Ratio
9.00
Ratio
8.00
7.00
6.00
5.00
4.00
3.00
2.00
1.00
0.00
2017 2018 2019
Ratio 7.51 8.50 6.43
I.A. 7.48 7.48 7.48
Year

The company has strong investment compared to the fixed assets value and
increasing the investment annually along with the increase in the value of the
fixed assets.

19

Conclusion for Financial Ratios

As a whole this company has strong points more than weak points but
this is not a good indication that it has a perfect situation, everywhere,
it going upward & have a good name in market & cannot forget that
the company has a huge manufacturing facilities in several locations
around the world and big number of running projects in several
countries.
For the Trend curve analysis of financial ratios above:
It’s very clear that there was a strong change in the company policy
during 2019 improved most of the trends.

We also can see that it has a good current Assets enable it to take
project & be exist in market but if it need any loans must take care
about interest rates on loans because its liabilities is increased year by
year also must decrease its expenses cost as it effects on Net income
& Owner Equity directly and must improve its employees & quality
more & more to increase its sales it is so necessary to decrease
inventory also because it affects badly on the current Assets.

So, if all of this is occurs in this case it's Returning on Net worth and
Profit margin will be improved.

20

Appendix
Financial statements of 2017 , 2018 & 2019
21

Hazem Hassan
Public Accountants & Consultants
Pyramids Heights Office Park Telephone : (202) 35 36 22 00 - 35 3622 11

Km 22 Cairo/Alex Road Telefax: (202) 35 36 23 01 - 353623 05
P.O. Box 48 AI Ahram E-mail : egypt@kpmg .com.eg
Giza - Cairo - Egypt Postal Code : 12556 AI Ahram
Translated from Arabic
Auditor's Report
To The Shareholders of EI Sewedy Electric Company
(An Egyptian Joint Stock Company)
Report on the financial statements
We have audited the accompanying consolidated statement of financial posItIOn of El Sewedy Electric
Company as of 31 December 2017 and the related consolidated statements of income, other comprehensive
income, cash flows and changes in equity for the year ended 31 December 2017, and a summary of significant
accounting policies and other explanatory notes.
Management's Responsibility for the Financial Statements

The financial statements are the responsibility of company's management. Management is responsible for the
preparation and fair presentation of the financial statements in accordance with Egyptian Accounting
Standards and in the light of prevailing Egyptian laws, management responsibility includes designing,
implementing and maintaining internal control relevant to the preparation and fair presentation of financial
statements that are free from material misstatement, whether due to fraud or error; management responsibility
also includes selecting and applying appropriate accounting policies; and making accounting estimates that are
appropriate in the circumstances.
Auditor's Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with the Egyptian Standards on Auditing and in the light of the prevailing Egyptian laws.
Those standards require that we comply with ethical requirements and plan and perform the audit to obtain
reasonable assurance whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements . The procedures selected depend on the auditor's judgment, including the assessment of
the risk of material misstatement of the financial statements, whether due to fraud or error. In making those
risk assessments, the auditor consider internal control relevant to the entity's preparation and fair presentation
of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion on the financial statements.
Hazem Hassan
Opinion
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects,
the consolidated financial position of El Sewedy Electric Company as of 31 December 2017, and of its
consolidated financial performance and its consolidated cash flows for the year then ended in accordance with
Egyptian Accounting Standards and the Egyptian laws and regulations relating to the preparation of these
consolidated financial statements.
Report on Other Legal and Regulatory Requirements
The consolidated financial information included in the Board of Directors' report, prepared in accordance with
Law No. 159 of 1981 and its executive regulations, are in agreement with the Company's books of account.
-::::Z
Public Accountants and Consultants
Cairo 27 February 2018

KPMG Mauro Hassan
PublicAccountants and Consultants
@
Translated from Arabic
EL Sewedy Electric Company
( An Egyptian joint stock company)
Consolidated statement of financial position
As of31 December 2017
31/12/2017 31112/2016
Note No. L.E L.E
Assets
Non current assets
Fixed assets (3-3)«6) 4305017 755
4055701087
Project under progress (3-3)«7) 418538068

302960558
Investments available for sale (3-4)«8) 10105037

10205008
Equity-accounted investees (3-4),(9) 1 213 III 060

1 246 145438
Investment certificates (10) 20000000

20000000
Trade and other receivables (3-4)«11) 3486374869

3867394013
Intangible assets (3-5)« 12) 180548664

117 147829
Deferred tax assets (3-16)'( 13) 474341 539

160057044
Total non current assets 10108036992

9779610977
Current assets
l.nventories (3-6)'(14) 7818948365
6085 344 359
Trade, notes and other receivables (3-4)«15) 14879193957

13487716480
Due from related parties (30) 548573297

663680218
Investment fund 1 treasury bills (3-4)'(16) 4232627 134

252016635
Banks and cash in hand ( 17) 4840105622

8270459888
Total current assets 32319448375

28759217580
Total Assets 42 427 485 367

38 538 828 557
Shareholders' Equity
Issued and paid capital (3-9)« 18) 2 184 180000
2234 180000
Reserves ( 19) 298 934 085

197412813
Own shares (20) ( 1422 160)

( 314 723 006)
Retained earnings 9429130905

6589888570
Translation reserve 1601 600949

2 278 304 825
Equity attributable to owners of the company 13512423779

10 985 063 202
Non controlling interests 643304985

584496934
Total equity 14155728764

11 569 560 136
Liabilities
Non current liabilities
Loans (3-11)«21) 330523 631
93615 881
Banks facilities and overdraft (3-11 )«22) 848809687

I 326954909
Deferred tax liabilities (3-16),(13) 660 120089

710087938
Provisions (3-12),(24) 143603 879

96546739
Other liabilities 109455011

40 177 613
Total non current liabilities 2092 512 297

2267383080
Current liabilities
Banks facilities and overdraft (3-11)<{22) 7 199 152473
8580762601
Loans (3-11) ,(21) 1 191042810

1216843472
Trade, notes and other payables (3-4),(23) 16386947207

13 444 740 820
Due to related parties (30) 371 383 820

376577 012
Provisions (3-12),(24) 1 030717 996
1082961436
Total current liabilities 26 179 244 306

24 701 885 341
Total liabilities 28271 756603

26 969 268 421
Total Equity and Liabilities 42 427 485 367

38 538 828 557
• The accompanying notes in the pages from (6) to (35) are an integral part of these consolidated financial statements .
c5y///
Chief Financial Officer Managing Director Chairman
Mr. Sherif Moha I ?einy
Auditor's report "attached"

-1

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Financial Analysis for ELSEWEDY ELECTRIC

Introduction to the company and their history……………………………………….3

I) Introduction to the construction industry in Egypt

Expanding government investments towards environmentally sustainable, energy-efficient

2) Introduction to ELSEWEDY ELECTRIC and their history

ELSEWEDY ELECTRIC is one of the leading energy solution and infrastructure

At the heart of ELSEWEDY ELECTRIC approach is an all-in-one integrated Engineering,

3) Discussion about other competitors in the market

4)Calculations of Financial ratios based on official financial statements

Measure the capability of company to meet its short-term Obligations.

1.1 - Current Ratio.

1.2 - Quick Ratio.

Trend Curve Analysis:

Weakness and Strength Points:

Trend Curve Analysis:

Weakness and Strength Points:

2.2 – Inventory Turn Over.

Trend Curve Analysis:

It seems to be stable and near the average expect year 2018.

Weakness and Strength Points:

2.3 – Fixed assets Turn Over.

Trend Curve Analysis:

Weakness and Strength Points:

2.4 – Total assets Turn Over.

Trend Curve Analysis:

Weakness and Strength Points:

Weakness and Strength Points:

3.2 – Return on Assets:

Trend Curve Analysis:

3.3 – Return on Equity:

Trend Curve Analysis:

Weakness and Strength Points:

Trend Curve Analysis:

Weakness and Strength Points:

4.2 Time interest earned Ratio:

Year 2017 2018 2019

Interest expenses is part of finance expense according to the financial statement

Year 2017 2018 2019

I.A. 6.34 6.34 6.34

Price per share: https://www.zawya.com/mena/en/stock/1000444/el-sewedy-

6 – Additional Ratios Group:

Year 2017 2018 2019

6.2 – Gross profit margin Ratio :

6.3 – Current assets to fixed assets Ratio:

Ratio 7.51 8.50 6.43

I.A. 7.48 7.48 7.48

Conclusion for Financial Ratios

For the Trend curve analysis of financial ratios above:

Pyramids Heights Office Park Telephone : (202) 35 36 22 00 - 35 3622 11

Translated from Arabic

To The Shareholders of EI Sewedy Electric Company

(An Egyptian Joint Stock Company)

Report on the financial statements

Management's Responsibility for the Financial Statements

Report on Other Legal and Regulatory Requirements

Cairo 27 February 2018

( An Egyptian joint stock company)

Consolidated statement of financial position

As of31 December 2017

Project under progress (3-3)«7) 418538068

Investments available for sale (3-4)«8) 10105037

Equity-accounted investees (3-4),(9) 1 213 III 060

Investment certificates (10) 20000000

Trade and other receivables (3-4)«11) 3486374869