View
1
Download
0
Category
Preview:
Citation preview
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE1
Edita Food industries reports 3Q2015 EarningsHealthy revenue growth driven by the croissant and candy segments with an EBITDA margin of 20.3%.
Highlights for 3Q2015
Revenues EGP 535.4 mn▲20.5% y-o-y
Gross Profit EGP 197.8 mn▲25.7% y-o-y
EBITDAEGP 108.8 mn▲28.8% y-o-y
Net Profit After Minority1 EGP 85.7 mn▲163% y-o-y
The discussion and analysis in this report are based on the IFRS statements. For comparison of the results to Egyptian Accounting Standards, please refer to the section “Egyptian Accounting Standards Reconciliation to IFRS”.
3Q2015 at a Glance
• Revenue increased 20.5% over 3Q2014 to EGP 535.4 million on the back of significantgrowthincroissants.RevenueofEGP1.58billionin9M2015up16.9%over9M2014.
• GrossProfitofEGP197.8million,a25.7%increaseover3Q2014withagrossprofitmarginof36.9%,upfrom35.4%in3Q2014.
• EBITDAmarginof20.3%,upfrom19.0%in3Q2014.• NetProfitafterTaxandMinorityInterestofEGP85.7millionin3Q2015,up
163%y-o-y(includesEGP23.9millionoftaxreversals1 during 3Q2015).Ad-justedNetProfitafterTaxandMinorityInterestforthequarterofEGP61.8millionwithamarginof11.5%.
• OnAugust13,2015,Editalaunchedanewandmorepremiumvarianttoitscroissantsegment,MoltoMix,adouble-filledcroissantwith2adjacentfill-ings2.
• InlinewiththeCompany’sstrategytoincreaseaveragepricepoints(andhencemargins),onSeptember27,2015EditalaunchedTwinkiesExtra,anupsizedTwinkiesatEGP1perpackanddelistedTwinkies(soldat50pias-ters).
• ThenewrusklineiscurrentlyunderinstallationattheE07factoryandisontrack to begin commissioning in the second half of December 2015. The stru-delline,initiallyplannedtostartproductionin4Q2015,will,aspreviouslyannounced,nowstartcommissioningduringFebruary2016.
1InAugust2015,theGovernmentofEgyptdecreasedtheincometaxratefrom30%to22.5%retroactivelystartingJanuary2015.During1H2015.Editawasaccru-ingtaxesatthehigherrateof30%andaccordinglythecompanyreversedatotalofEGP23.9millionin3Q2015owingtothegovernment’sdecision.
2ThetwovariationsofMoltoMixarecream&chocolatefillingandcream&strawberryfilling,andareavailableintheXXLsizeatEGP2perpack.
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE2
Results in a NutshellEditaFoodIndustriesS.A.E.(EFID.CAontheEgyptianExchange&EFIDq.LontheLondonStockExchange),aleaderintheEgyptianpackagedsnackfoodmarketwithnumber-onemarketsharesinitscorecakeandcroissantsegments,announcesitsresultsforthethirdquarterof2015reportingahealthygrowthinrevenuesacrossallitsseg-ments,anddespitethedifficultiesfacingtheEgyptianmarket,withtoplinecomingin16.9%highery-o-yatEGP1,579millionforthe9M2015period.
Meanwhile,onathreemonthsbasisthecompanyturnedatoplineofEGP535.4millionin3Q2015,up20.5%y-o-yprimarilyonthebackofcapacityadditionsthatbegantobearfruitespeciallyinthecroissantsegmentwhichreporteda58.1%y-o-ygrowthinthequarter.Growthinthecakesegmentstoodat4.3%y-o-yin3Q2015.
Onthecostside,3Q2015sawageneralincreaseinexpensesontheoperationallevelinlinewithCompany’sgrowthpath.OverallCOGSincreased17.6%y-o-yonthebackofhighermanufacturingoverheadsandincreasedenergycosts.Grossprofitmargins,however,rosetoahealthy36.9%comparedto35.4%in3Q2014.
During3Q2015,SG&A3increasedto19.1%ofsales,asEditaincreasedadvertisingtosupportbothincreasedcapacitiesandnewproducts,andalsopreparedforthelaunchofthreenewdistributioncenters.
Snapshot of Results (EGP million)
3SG&AisthesummationofSelling&Distributionexpenses,Advertising&Marketingexpenses,andGen-eral&Administrativeexpenses,allofwhichareincludedinthecompany’sauditedfinancialstatementsunderDistributionCostsandAdministrativeExpenses.
*InAugust2015,theGovernmentofEgyptdecreasedtheincometaxratefrom30%to22.5%retroactivelystartingJanuary2015.During1H2015.Editawasaccruingtaxesatthehigherrateof30%andaccordinglythecompanyreversedatotalofEGP23.9millionin3Q2015owingtothegovernment’sdecision.
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE3
RevenuesRevenues Progression (in EGP million)
Totalrevenueincreased20.5%over3Q2014levelstoEGP535.4million,androse4.0%comparedto2Q2015.Growthwasmostlyvolumedrivenduetoincreasedcapacityinthe croissant and cake segments. Revenues from the croissant segment increased to 35.4%ofrevenues,upfrom26.9%ayearearlier,whilethecontributionofcakesalesdecreasedto54.3%ofthetotalin3Q2015,downfrom62.7%in3Q2014,inlinewiththeCompany’sstrategytodiversifyitsproductportfolio
Revenuesfromthecroissantsegmentgrew58.1%y-o-yand23.5%q-o-qtoreachEGP189.3million,mostlyvolumedrivenbycapacityadditionsofthetwonewlinescom-missionedduring1H2015.Thecroissantsegmentcontributed35.4%toEdita’srevenuein3Q2015,upfrom29.8%inthepreviousquarter,reflectingtheincreasedcapacityandthecompletionoftherampupofthenewlinesthathadstartedoperationduringthefirsthalfoftheyear.Onay-o-ybasis,higherutilizationratesonthecroissantlinesingeneralalsocontributedtothegrowthinrevenues.Theaverageutilizationratesonthecroissantproductionlinesduring3Q2015wasat96%inspiteofthecapacityaddi-tions,reflectingstrongdemandinthemarket.Asthenewhigher-pricedMoltoMix4wasintroducedtowardtheendofthequarter,theaverageconsumerpricepercroissantSKUremainedatEGP1.11ascomparedtothe2Q2015pricelevel.Ontheproductionlevel,yeartodateEditaproduced27,078tonsofcroissantin9M2015,upfrom24,630tonsin9M2014.Capacityinthegeneralcroissantsegment,albeitduetoadifferentvariationoftheproduct,willfurtherincreaseasthestrudelproductionlinestartscommissioninginFebruary2016.
During3Q2015,revenuefromcakesincreased4.3%over3Q2014levelstoEGP290.9million.Onaquarterlybasis,revenuefromthecakesegmentdecreasedby1.6%q-o-q,attributedtothefactthatutilizationrateswereintentionallybroughtdowninprepara-tionforthedelistingoftheEGP0.50TwinkiesSKUandtheintroductionofTwinkiesExtraatEGP1.Overallutilizationonthecakelinesduring3Q2015was91%com-
4OnAugust13,2015,Editalaunchedanewandmorepremiumvarianttoitscroissantsegment,MoltoMix,whichsellsataconsumerpriceofEGP2higherthantheaverageofthecurrentcroissantconsumerpriceperSKU.MoltoMixtotalrevenueforthesixweekssinceitslaunchin3Q2015recordedEGP7.8million,c.4.1% of the croissant total.
Segment Contributionto Revenue 3Q2014 (EGP mn)
Segment Contributionto Revenue 3Q2015 (EGP mn)
Cakes EGP 278.8 Croissants EGP 119.8 Rusks EGP 23.5 Wafers EGP 9.1 Candy EGP 11.5 Imports EGP 1.8
Cakes EGP 290.9 Croissants EGP 189.3 Rusks EGP 21.5 Wafers EGP 12.7 Candy EGP 19.2 Imports EGP 1.9
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE4
paredto93%in2Q2015and100%in3Q2014.ThecakesegmentremainsEdita’scoreproductandcontributed54.3%tototalnetrevenueduring3Q2015,downfrom57.4%in 2Q2015. The key drivers contributing to the slight decline in revenue since 2Q2015 werevolumedriven.TheaverageSKUconsumer-sellingpriceofcakesin3Q2015increased2.9%over3Q2014toEGP0.69perpack.
Edita’smarketshareinthecakesegmentincreasedslightlyover2Q2015to64.5%.Dur-ing3Q2015,EditatookthedecisiontoupsizeTwinkies,increasingitssizeanddoublingitsconsumerpricetoEGP1perpack.Itworthnotingthatduring9M2015,thetotalnetrevenueofTwinkieswasEGP335million(approximately37%ofcakerevenuesand21%oftotalrevenues).Therationalebehindtheupsizingisbothafinancialone(in-creasingtheCompany’sgrossprofitmarginfromitscorecakeproduct)aswellasbeingresponsivetonewmarketdynamicsintermsofpricepoints(basedonmarketresearch,themarketpreference/“sweetpricepoint”ismovingawayfrom50piastersperpackandtowardtheEGP1pricepoint).ThenextsteponwhichEditawillembark,andhasactu-allystartedpreparingfor,isthelaunchofseveralnovelproductstothemarketstarting2016,someofwhichhavebeendevelopedin-house,whileotherswillbebasedonthenewproductswhoseknowhowwasacquiredfromHostessBrands.
Salesofruskswere8.3%downin3Q2015over3Q2014levels(2.6%downq-o-q)toEGP21.5millionandconstituted4%ofEdita’stotalnetsales.Again,thisdeclinewasvolumedriven,astheutilizationratesdecreasedto97%from100%ayearearlier,dueto management redirecting some of the labor on the rusks line to the croissant lines to overcomelaborshortagesandtobettermanageresources.Edita’sManagementbelievesrusks’revenueswillreboundsignificantlyaftercapacityisdoubledwiththenewlinecommencingproductioninthesecondhalfofDecember2015.
Wafersalesduring3Q2015reflectedtheseasonalitywithinthissegment,asc.80%ofEdita’swafersalesareofthecoatedvarietythatarenotpopularduringthesummermonths.Asaresult,althoughwafersalesincreased39.6%over3Q2014levelstoEGP12.7million,theywerec.44%lowerthan2Q2015.ToreflectEdita’spolicyofonlyholdinganinventoryofthree-day-oldfinishedgoods,theutilizationrateofthewaferlinewasbroughtdowntoanaverageof71%from87%inthepreviousquarter.Waferrevenuesrepresented2.4%ofEdita’srevenuescomparedto2.1%ayearearlier.
Comingfromalowbase,revenuefromthecandysegmentgrewby66.3%over3Q2014levels(1.8%q-o-q)toreachEGP19.2million,operatingatanaverageutilizationrateof89%acrossthethreelines.Notonlywastheincreaseduetothechangeinthebusinessmixofthecandyproductssince2014(increasingtheconsumerpriceperpacktoEGP2.05),butitalsorelatestothecapacityenhancementsthatincreasedtotalcapacitydur-ingthequarterby68%comparedto2014levels.
Totalrevenueinthe9M2015increased16.9%toEGP1.579billioncomparedtoEGP1.350billioninthesameperiodlastyear.Edita’stotalproductionfor9M2015reached82.1thousandtons(2.3billionpacks)comparedto73thousandtonsin9M2014(2.1billionpacks).Hereunderistheprogressionofblendedfactorypricesforallproductsegments:
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE5
Average Factory Prices
EGP 3Q2014 3Q2015 % ChangeCakes 0.51 0.53 3.7%Croissant 0.88 0.87 -1.0%Rusks 0.81 0.81 0.0%Wafers 0.74 0.75 0.5%Candy 1.03 1.17 13.9%Average Edita 0.61 0.65 7.0%
3Q2015 Revenue Growth by Segment (y-o-y)
Cost of Goods Sold5
In3Q2015,thecostofgoodssoldincreased17.6%over3Q2014levelstoEGP337.6million,resultinginaCOGS/salesratioof63.1%,downfrom64.5%in3Q2014.
During3Q2015,thecostofsales(directmaterials)grewby15.3%y-o-ytoEGP258.2million,ataratebelowrevenuegrowth,benefitingfromboththegeneraldeclineinglobalcommoditypricesaswellasthecompetitivepricestheSupplyChainhadlockedinforcommoditiesthatwereseeinganincreaseinprice,includingcocoaandpackaging(OPP)6.EditamanagedtosaveonthebudgetedcostsofsalesastheCompanylockedinfavorablepricesacrossmostmaterialsandinsomecases,lockedinpricesuntil3Q2016,includingmilkpowder.Inadditiontolockinginthepricesofcommoditiespriortotheirincrease,theSupplyChainDepartmentmorerecentlysecuredsugaruntil1Q2016atfavorableprices.Inaddition,Edita’sdiversifiedcostofsalesandvastexpanseofdirectmaterialsused(bothrawandpackaging)continuetoactasanaturalhedgeagainstglobalcommoditypricemovements.
ThegrowthinCOGSisalsopartiallyattributedtotheincreaseinmanufacturingover-heads(MOH).MOHincreased24.2%y-o-yin3Q2015,representing12.4%ofrevenueand19.7%ofCOGS.ThemaincontributorstotheincreaseinMOHarewagesand
5 Breakdownswithinthissectionarederivedfromthecompany’smanagementreport.6PleaserefertotheSupplyChainsectionformoredetails.
Direct Material Breakdown 3Q2014
Direct Material Breakdown 3Q2015
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE6
salaries,aswellasanincreaseinelectricityandnaturalgasbillsandadditionalcostsrelatedtomachinerymaintenance.Withregardstoenergycosts,theincreasecamefrombothEdita’sincreasedutilizationcoupledwiththeincreaseinenergypricesintroducedbythegovernmentin2H2014aspartofitssteppedprogramtoremoveenergysubsi-dies.Edita’stotalelectricityandnaturalgasbillincreased55.1%overthe3Q2014leveltoreachEGP9.95million(14.9%ofthetotalMOH).Themajorincreasecameintheelectricitybill,whichrose70.4%overtheperiodasaresultofa25%increaseintariffcoupledwithac.44%increaseinEdita’susage.
Gross ProfitGross Profit Progression (EGP million)
Grossprofitin9M2015increased19.7%over9M2014levelstoEGP594.0million,lockinginamarginof37.6%,anincreaseoverthepreviousyear’smarginof36.7%,reflectingnotjusttheoverallincreaseinrevenuesbutalsotheintroductionofnewhigher-marginSKUsduring2015.However,in3Q2015,grossprofitincreased25.7%over3Q2014levelstoEGP197.8million,achievingagrossprofitmarginof36.9%,upfrom35.4%ayearearlier,butcominginbelowthe2Q2015levelof37.6%,mainlyow-ingtotheincreaseinMOHandtheincreasedenergyexpenses.
Gross Profit Margin by Product Segment
Contribution to Gross Profit by Product Segment 3Q2015 (EGP mn)
Contribution to Gross Profit by Product Segment 3Q2014 (EGP mn)
Cakes EGP 97.3 Croissants EGP 50.9 Rusks EGP 5.8 Wafers EGP 2.5 Candy EGP 0.1 Imports EGP 0.6
Cakes EGP 107.1 Croissants EGP 74.5 Rusks EGP 6.1 Wafers EGP 4.7 Candy EGP 4.6 Imports EGP 0.8
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE7
Onay-o-ybasis,grossprofitmarginsfortherusk,waferandcandysegmentsincreasedin3Q2015over3Q2014levels.TheimprovementsreflectEdita’scontinuedandsuc-cessfuleffortsforlineenhancementsandincreasedproductionefficienciesacrossallfactories,whetherasaresultoftweakingtheprocessesormorefocusedandtargetedproductionplanning.Withinthewafersegment,grossprofitmarginsincreasedfrom27.7%in3Q2014to36.8%in3Q2015,mostlyduetoefficiencies.Thegrossprofitmarginswithinthecandysegmentsurgedto24.2%in3Q2015from1.2%in3Q2014astechnicaldifficultiesthatwereovercomeattheendof2014andcapacityenhancementswereintroducedtotheproductionlines.
Grossprofitmarginwithinthecakesegmentincreasedto36.8%in3Q2015from34.9%in3Q2014,mainlyasaresultoftheincreaseincapacity.However,GPMwasdownfrom38.5%in2Q2015,reflectingtheloweraverageutilizationratesonthecakepro-ductionlines,asdiscussedabove.However,ManagementexpectsmarginsforthecakesegmenttopickupastheeffectoftheTwinkies’upsizingtakesfiltersintotherevenues.Grossprofitmarginforthecroissantbusinessrecorded39.3%in3Q2015(downfrom42.5%in3Q2014,yetupfrom2Q2015),reflectingthecompletionoftherampupofthenewestcroissantline(commissionedattheendofApril,withacapacityof17,000tonsperyear)andthenewhigher-marginSKU(MoltoMix)beinglaunchedonAugust13,2015.
Edita’scorecakeandcroissantproductsegmentsremainthemaincontributorstotheCompany’sgrossprofit.During3Q2015thecakeandcroissantsegments’contributiontogrossprofitwasEGP181.6million,constituting91.8%ofthetotalgrossprofit(and90%ofrevenue). Other ExpensesThethreemainexpensecategoriesrelatingtooperationsarenamely:SellingandDistri-butionExpenses(S&D),AdvertisingandMarketingExpenses(A&M)andGeneralandAdministrativeExpenses(G&A).TotalSG&AreachedEGP102.1million7,up10.0%overthe3Q2014levelandup12.3%q-o-q. S&Dexpensesincreased17.9%toEGP42.9million(8.0%ofrevenue)in3Q2015fromEGP36.4million(8.2%ofrevenue)in3Q2014.TheincreasereflectsEdita’sstrategyof fostering and increasing sales through the various retail channels and increasing its geographiccoverage.ThemainitemswithinS&Dexpensesaresalariesandwages,whichhavewitnessedtheirnormalannualincrease,aswellastruckrentalswhichhaveincreasedasEditabegantooutsourceitsprimarydistribution,thetransportationofproductsfromitsfactoriestothedistributioncenters.However,thiswascoupledwithac.30%decreaseintruck-fuelcostsinspiteoftheincreaseinenergycostssincelastyear.CommissionsandincentivestotheSalesRepresentativesincreasedby20.6%tosupportthelaunchofthenewproducts,namelyMoltoMixandTwinkiesExtra.ItmustbenotedthattotalS&Dexpensesincludecostitemsrelatingtothelaunchpreparationforthethreenewdistributioncentersthatarecomingonlinein4Q2015.
7SG&Abreakdownisderivedfromthecompany’smanagementaccountstoensureanaccuratedepictionofeachofEdita’sexpensesandhowtheyreflectonthebusiness.
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE8
A&Mexpensesincreasedby31%over3Q2014levelstoEGP24.6million8 and consti-tutedanall-timehighof4.6%ofrevenue.ThebulkofexpensesrelatestotheaggressiveTVadvertisingcampaigntomainlysupportEdita’snewlylaunchedcroissantproduct,MoltoMix.TopartiallycountertherisingratesofTVandoutdooradvertising,Editacontinuestodevelopitsadvertisingthroughsocialmediachannelsforitsentireproductrange.Havingsaidthat,Managementremainsverydiligentwithspending,keepingittotheminimumthatisrequiredtosupportnewproductsaswellasmaintainitscurrentmarketshares.ThedecisiontolaunchanewproductorcontinueproducinganexistingoneinvolvescarefullytakingitsassociatedA&Mspendingintoconsideration.
G&Aexpensesweredown8.3%over3Q2014toEGP34.5million,constituting6.5%ofrevenues.However,itmustbenotedthatduring3Q2014,G&AincludedEGP10millionofCSRspendingviaadonationtotheTahyaMisr(LongLiveEgypt)fund.Adjustingforthat,G&Aexpensesincreased24.9%y-o-y.OneofthemaincomponentsofG&Aincludessalariesandwagesthatincreasedc.23%y-o-yonthebackoftheincreasedheadcountaswellastheusual10%annualincreaseinsalariesandwages.Furthermore,asEditaismovingtowardamodelofcashdepositingbysalesrepresenta-tivesatremotecashpoints(Fawry),tobothstreamlineoperationsandminimizetheriskoflossortheft,thecostofthisserviceisbecomingarecurrentandpermanentcompo-nentofG&Aexpensesasitisgainingtractionandprovingtobeaveryviableoption.G&Aexpensesduring3Q2015alsoincludedthetrademarkregistrationfeesfortheHTTbrands across the region.
ProfitsfromOperationsincreased20.8%over3Q2014toEGP83.5million,withamar-ginof15.6%.Thisisa17.8%declineover2Q2015andisattributabletotheincreaseinSG&A,asdiscussedabove.
Interestexpensein3Q2015totaledEGP10.2million,upfromEGP6.1millionin3Q2014,astheCompany’sdebtincreasedinlinewithEdita’sstrategytofinanceitsexpansions,equallythroughdebtandtheCompany’sownresources.ThemostrecentloanwastheEGP90millionmedium-termloantofinancetheHostessbrandscontractssignedin2Q2015.Ontheotherhand,interestincomeincreasedtoEGP6.6millionin3Q2015fromEGP5.0millionayearearlierasamoreflexiblecash-managementpolicythathasallowedEditatocapitalizeonfavorableopportunitiesinthemarket.
Over3Q2015,EditabookedanFXlossofEGP4.1million(alossofEGP3.8millionfor9M2015)asaresultofarevaluationofliabilitiesinforeigncurrencyrelatingtothenewlinesamidtheweakeningoftheEGPagainsttheeuroandUSD.InJuly2015,theCentralBankofEgypt(CBE)undertooka20piasterdevaluationoftheEGPagainsttheUSDtoreachanofficialrateofEGP7.83/USD(correspondingeuro:EGPratesincreasedto8.82from8.58in2Q2015).
8Notethat3Q2014financialstatementswereauditedandhencedonotreflectthechangeinmarketingac-crualcalculationintroducedinJanuary2015,withtheeffectbeingmostprominentinthechangeinA&Mexpenses.
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE9
EBITDAEBITDAreachedEGP108.8millionin3Q2015withamarginof20.3%,higherthan3Q2014levelsinbothabsoluteandmarginterms(a28.8%riseover3Q2014witha19.0%margin).Giventheseasonalityofthebusiness,EBITDAshouldbeevaluatedona full-year basis.
Net EarningsNOPAT Progression (EGP million)
*3Q2015and9M2015NOPATincludeataxreversalofEGP23.9million
Duetotheissuanceofthenewtaxlawduring3Q2015thatbroughtdownthecorporatetaxrateto22.5%from30%retroactiveJanuary1,2015,EditahadataxreversalofEGP23.9millionin3Q2015.Accordingly,totaltaxesfor9M2015decreasedtoEGP55.9millionfromEGP98.0millionin9M2014.
NetProfitAfterTaxandMinorityInterestfor3Q2015increased163%from3Q2014levelstoEGP85.7million(marginof16.0%).AdjustedNOPAT9 for 3Q2015 is EGP 61.8million(11.5%margin).The9M2015adjustedNOPATincreased15.7%over9M2014toEGP188.2million,withan11.9%margin.
9AdjustedforEGP23.9milliontaxreversal.
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE10
Balance SheetTotalassetsincreasedtoEGP1.9billionin9M2015fromEGP1.6billionasatyear-end2014.ThebulkoftheincreaseemanatedfromtheincreaseinProperty,Plant&Equip-ment,astheextensionoftheE07plantmaterializedandthedeliveryofthethreenewlineswascompleted.Property,Plant&EquipmentincreasedtoEGP1.022billionin9M2015fromEGP818.4millionasattheyear-end2014,whileProjectsunderCon-structiondecreasedtoEGP166.9millionfromEGP197.4millionasattheyear-end2014afterthedeliveryofthenewextension.
TotalCAPEXfor9M2015reachedEGP230.3million,ofwhichEGP164.0millionwasexpansionCAPEX.ThemainitemofCAPEXduringthe9M2015wasEGP109.0mil-lionpertainingthecompletionofHallB(extensionoftheE07factory).TotalCAPEXrelatingtotheacquisitionoflandforthenewfactoryE08amountedtoEGP54.9mil-lion,includingthecostofthelandplotandrelatedinfrastructure.ItisalsoworthnotingthattherusklinecurrentlyunderinstallationintheE07factoryhasarelatedYTDCAPEXofEGP31.4million.
EditacontinuedtomaintainahealthyCash&CashEquivalentsandTreasuryBillswithabalanceofEGP355.9millionasattheendofSeptember2015,constituting18.4%oftheCompany’stotalassets.
OnWorkingCapitalcomponents,theinventorylevelscontinuetoreflectEdita’spolicyofmaintaininginventorycoverageofalldirectmaterials,onemonth’s-worthofsalesforlocallysourcedmaterialanduptothreemonthsofimportedmaterial,withanaverageof0.76monthsduring9M2015.Theinventoryoffinishedgoodsremainedatanaverageof2.5daysforthe9M2015.TradeReceivablesdecreasedtoEGP8.7millionin9M2015,reflectingEdita’scontinuedcashsalespolicy(inexcessof97%ofsalescontinuetobeconductedonacashbasis).Trade&OtherPayablesincreasedslightlytoEGP243.6millionasEditawasabletosecurebetterpaymentterms(c.50days)withseveralofitskeysuppliers.
TheCurrentPortionofLong-TermLiabilitiesincreasedtoEGP164.9millionfromEGP125.2millionasattheyear-end2014andLong-TermLoansincreasedtoEGP329.0millionfromEGP204.5millionattheendof2014.ThisisaresultofloansdrawndowntofinancethenewproductionlinesandtheHostesscontractssignedduring2Q2015.
TotalShareholders’EquityincreasedtoEGP1.038billionasattheendof9M2015,upfromEGP825.7millionasatDecember2014.
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE11
Egyptian Accounting Standards Reconciliation to IFRS
ThemaindifferencesfoundinEdita’sfinancialstatementsareduetoseveralfactors.Firstofall,theIFRSrequiresthatemployees’profitsharingbeexpensed,whiletheEgyptianAccountingStandardstreatthemasadistributionandhencedonotincludethemwithintheincomestatement.In1Q2015,netemployeeprofitsharingpaidwasEGP21.8million.Furthermore,thetreatmentofFXgainsandlossesaswellasgainsandlossesonfixedassetstransactionsdiffersinthecalculationofEBITDA.Addition-ally,anEGP1.7millionofadjustmentsinEBITDAcamefromtheEGP2.2millionIPOexpensesandEGP0.5millioninprovisions.
HereunderisthereconciliationbetweenEdita’sfinancialstatementsinEASwiththeIFRS-basedfinancialstatementsfor9M2015.
in EGP mn 9M2015 EAS Adjustment 9M2015 IFRS Net Sales 1,579.1 1,579.1COGS(excludingM.O.H) (791.8) - (791.8)M.O.H (184.9) (8.4) (193.3)Gross Profit 602.4 (8.4) 594.0Gross Profit Margin 38.2% 37.6%DistributionExp. (199.6) (5.9) (205.5)General&Admin.Exp. (112.8) (7.5) (120.3)OtherOperationalGains(Expenses)* 8.4 (3.8) 4.6Profit from Operations 298.4 (25.6) 272.8Profit from Operations Margin 18.9% 17.0%Provisions 4.0 - 4.0NetFinancingCost (8.6) 3.8 (4.8)OtherIncome(Expenses) (8.2) - (8.2)Profit Before Income Tax 289.8 (21.8) 268.0IncomeTaxExpense (55.9) - (55.9)Net Profit After Tax 233.9 (21.8) 212.1Net Profit After Tax Margin 14.8% - 13.4%EBITDA 355.2 (23.5) 331.7EBITDA Margin 22.5% 21.0%
*Includesdepreciation&royaltyexpense.Furthermore,EGP3.8millioninadjustmentsisrelatedtoFXlossesthataretreatedasFinanceCostsunderEASandOtherOperationalCostsunderIFRS.
Market DevelopmentsThesegmentsofthesnackfoodmarketinEgyptinwhichEditaoperatescontinuedtogrowy-o-y,withanevidentpickupingrowthrelativeto2Q2015giventheusualseasonalityanddipsindemandinthesnackfoodmarketingeneralinthesecondquarter.Thecroissantsegmentremainsthefastest-growingsegmentwithathree-yearCAGRof38%(basedon8M2015),whiletheslowestgrowth,albeitstillatc.10%,remainsthecakesegment,andhenceEdita’sstrategytolaunchseveralnovelproductswithinthissegmentduring2016tobolstergrowth.
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE12
Selected Segments of the Snack Food Market in Egypt – January to August 2015
Segment Market Size (EGP mn)* 2013-2015 CAGR*
SaltySnacks** 4,477 12.9%Cakes 1,121 9.6%Wafers 1,191 11.9%Croissant 539 38.0%
Please note that the market sizes depicted in the table above only represent eight months as AC Nielsen publishes retail audit data every two months.
*YTDAugust2015** Rusk market is 5.1% of total salty snacks Source:ACNielsenRetailAudits
AccordingtoNielsen,in3Q2015Editaslightlyimproveditsmarketsharesinboththecakeandcroissantsegmentsascomparedto2Q2015.However,overthe8M2015periodmarketsharesinbothcoresegmentsdeclinedfrom67%and69%to65%and67%,respectivelycomparedtosameperiodlastyear,attributedmainlytothelackofcapac-ityduringthefirstfewmonthsof2015astheextracakeandcroissantcapacitiesweredelayed.
Edita’smarketshareinruskscontinuedtodecline,reaching36%in8M2015from43%overthesameperiodlastyear,whilethemarketshareinwafersremainedat1H2015levelsof8%(upfrom5%in8M2014).
Source:ACNielsenRetailAudit,IPSOS1.RelativemarketsharecalculatedasEdita’smarketsharedividedbymarketshareoflargestcompetitor.2.US$/EGPof7.83asof30September-2015(CBE).3.Brandawarenessmeasurestheshareofrespondentsthatwerefamiliarwiththebrandinaided,spontaneous
consumer surveys.4.MarketshareforCandyisasatyearend2014
Market Position
Market Share4
Relative Market Share1
Av. Consumer Price
(EGP / US$2) BrandsBrand
Awareness3
Cakes 65% 9.5x 0.7/0.09 100%
Croissants 67% 3.1x 1.11/0.14 100%
Rusks 36% 0.6x 1.00/0.13 75%
Wafers 8% 0.3x 1.00/0.13 86%
Candy 8% 0.4x 2.05/0.26 NA
#1
#2
#1
#4
#3
90%of3Q2015 Revenue
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE13
MarketingIngeneral,therewasnochangeinEdita’soverallmarketpositioningthisquarter;Editaremainsbyfarthelargestplayerinitscroissantandcakesegments,withgrowingpres-enceinthecandysegment.Nevertheless,startingin3Q2015,theMarketingDepartmentembarkedonamoreaggressivemarketingstrategy,intensifyingmarketingandadvertisingactivitytosupportthenewcapacitiesandproductsintroducedduring2Q2015and3Q2015andcakesalesaswell,assignsofamarketsofteningbeguntoemergewithintheexistingcakeproductsonthemarket.Thisisevidentintheincreasedmarketingandadvertisingexpensesexplainedabove.
During3Q2015,Editalaunchedanewadvertisingcampaigntointroducethenewcrois-sant,MoltoMix,throughoutdoor,digitalmediaandTVcampaignsaswellasthroughthecontinuedbrandingofEdita’sdistributiontrucksandvans.AttheendofSeptember2015,EditalaunchedthenewTwinkiesExtraSKU,aTwinkiethatislargerinsizeandsellsatEGP1/unitpricepoint,whiledelistingthe50piasterTwinkiesSKU.TheadvertisingcampaigntolaunchtheTwinkiesExtraispredominantlyaTVcampaign.
FollowingthelaunchoftheMoltoMixandtheTwinkiesExtra,Editahas69SKUsunderproduction,asthreecandySKUsweredelistedin3Q2015.
Editacontinuestomaintain100%brandawarenessinitscoremarkets,namelythecrois-santandcakesegments.Waferawarenesscontinuestoimprove,reaching86%.Brandawarenessintherusksegmentremainsrelativelylowerthanintheothersegmentswithascoreof75%,butthisreflectstheCompany’smorefocusedcommunicationtosustainandsupportitsnicheconsumerbasethroughdigitalandbelow-the-linecommunicationgiventhelimitedproductioncapacitythusfar.
Withtheacquisitionofthetechnicalknowhowof11additionalnewproductsfromHostess,theMarketingTeamiscloselyworkingwiththeR&DDepartmenttoworkonthebrandingofnewproducts,withseveralproductshavingalreadybeenscheduledforconsumertestinginpreparationforlaunchin2016.
Editacontinuestofollowavigilantpricingstrategyduetothehighpriceelasticityofbothitsmarketandtargetconsumerbase.During3Q2015,averageconsumerpricesforcakesandcroissantsremainedrelativelystabley-o-y,increasingonlyby2.9%and0.1%,respectively.AverageconsumerpricesforboththeruskandwafersegmentsremainedunchangedasEditahasnotlaunchedanynewSKUsorundertakenanyupsizingofproductsinthesesegmentssince3Q2014.Ontheotherhand,averageconsumerpricesforthecandysegmentincreasedby19.7%y-o-yasthe“Fakka”producttookfulleffectafteritsintroductionontothemarketduringthelatterpartof2014.AstheFakkaSKUshavegainedpopularitysincetheirlaunch,EditainOctober2015launchedaFakkaSKUoftof-feestohaveallthecandytypesavailableinthislargerfamilypackvariation.
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE14
Development of Average Consumer Price by Product Segment
EGP 3Q2014 3Q2015 % ChangeCakes 0.67 0.69 2.9%Croissant 1.11 1.11 0.1%Rusks 1.00 1.00 0.0%Wafers 1.00 1.00 0.0%Candy 1.71 2.05 19.7%Average Edita 0.79 0.84 7.2%
Sales & DistributionDuring3Q2015,Edita’ssalesbychannelofdistributionreflectedtheCompany’sstrategyofincreasingrevenuesthroughtheretailandtraditionalsalespointsofsaleandawayfromwholesaledistribution,whilesimultaneouslygrowingsalesthroughallsaleschannels.Grosssalesthroughwholesalein9M2015grewby13.5%y-o-ytoEGP979millionandcontributed59.1%oftotalrevenues,comparedto61.0%overthesameperiodlastyear.Year-to-dategrosssalesthroughretailandtraditionaltradegrewstronglyby23.6%y-o-ytoEGP528.3millionandconstituted31.9%oftotalrevenuescomparedto30.2%overthesameperiodduring2014(contributionincreasedto33.0%in3Q2015).Revenueemanatingfromsupplyandkeyaccounts(moderntrade)remainedatthesamelevelsasthepreviousyearandcollectivelycontributedapproximately3%oftotal revenue.
Exportsincreasedby23%in9M2015over9M2014toEGP99millionandremainedapproximately6%oftotalgrosssales.ThePalestinianTerritories,Iraq,Syria,JordanandLibyaremainourcoreexportingcountries,constitutingaround83%oftotalexportrevenuein3Q2015.Itisworthmentioningthatduring3Q2015,exportstotheWestBankrepresented27%ofgrossexportsales.During3Q2015,Editaexportedto12countriesacrosstheMENAregionandAfricaincludingSaudiArabiaandSudan.
Bytheendof3Q2015,thetotalnumberofcustomersthatEditacateredtodirectlyin-creasedto63,131pointsofsale,upfrom60,209ayearearlier,reflectingtheCompany’sstrategyofexpandingitsproprietarydistributionnetworkacrossEgypt.TheCompanyhasplanstoopenthreenewdistributioncenters(inMenoufia,Alexandriaand15thMayCity)byyear-end,bringingthetotalto21distributioncenters.Thetotalnumberofretailandtraditionaltradepointsofsalesservicedgrew5%overthepreviousyearto57,902attheendofthequarter,whilethenumberofwholesalersservicedincreasebyonly2.8%.Thetop-100wholesalerscontinuedtodominatethebulkofsalesthroughwhole-salers,andcontinuetoconstitutearound39%oftotalsalesthroughthatchannel.
Theexpansionofthesalesforcetohandletheincreasedbusinesshasbeenexecutedeffi-ciently,wherethenumberofdistributionvansattheendof3Q2015increasedby10.8%over3Q2014to544,whilethesaleforceincreasedbyonly3.5%to1,003,reflectingtheemployee-optimizationprogramlaunchedinthelatterpartof2014.
Revenue Contribution by Distribution Channel 3Q2014
Revenue Contribution by Distribution Channel 3Q2015
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE15
Moreover,Editacontinuestogrowitssalesforceefficientlyinlinewithbothcurrentandplannedgrowth.Thegrowthinsalesin3Q2015throughwholesalerswasmainlyduetotheincreaseindropsize/sizeoftheinvoiceperwholesalerwhilegrowthinrev-enuethroughtheretailchannelswasafunctionofboththeincreaseindropsizeaswellastheincreaseinnumberofretailersovertheperiod.Thereweresignificantimprove-mentsinallthemainKPIsinboththewholesaleandretailsidesofthebusiness.Thenumberofsuccessfulvisits,coverageandinvoicesizeallgrewover3Q2014levelswhilewastedeclined.
Supply ChainTheSupplyChainDepartmentcontinuedtotrackglobalcommoditypricesinordertomaximizeEdita’soperationalefficienciesbylockinginpricesofdirectmaterialsatattractivelevels.During3Q2015,Editamanagedtomaintainahealthycostofsalesasa result of having secured several of the major direct materials at an average of around 8%lowerthanthebudget.Rawmaterialsremainthelargestconstituentofthedirectmaterialbill,being72.1%ofthetotaldirectmaterialcostsin3Q2015.
Over3Q2015,cocoapricescontinuedtoincreaseontheinternationalmarket;however,theSupplyChainDepartmentmanagedtosecureEdita’srequirementsofcocoaforFY2016atanaverageof15%lowerthanthecurrentprevailinginternationalprices.Anotherdirectmaterialworthnotingismilkpowder,whosepriceshavefluctuatedoverthecourseofthepastfewmonths.Aspriceshavesinceeased,theSupplyChainDepart-menttookadvantageandlockedinpricesofmilkpowderupuntil3Q2016. DuetothecontinueddevaluationoftheEGP,importeddirectmaterialsareslowlyin-creasinginproportiontothetotaltoreach26%in3Q2015,upfrom24%in2Q2015and21%in3Q2014.TheFXimportationbillofthedirectmaterialscontinuestobepartiallyfinancedthroughEdita’sexportproceeds.ExportsduringthequarteramountedtoEGP30million,whichcoverapproximately50%ofthetotalimportcosts.
Planningactivitiesshowedsignificantimprovementy-o-yduring3Q2015,intermsofincreaseddailyproductioncapacitiesacrossallthefactoriesandproductionlineutiliza-tions,aswellaskeepingtheinventorycoverageofallproductionmaterialsatanaver-ageof0.67monthsandfinishedgoodsatanaverageof2.2daysofsalesforthequarter.
Industrial OperationsDuring3Q2015,Editaproducedatotalof27,078tons,9.9%upfrom3Q2014levels,with90%overallutilizationrateacrossallthefactoriesandlines.Thiscorrespondsto779millionpacks,anincreaseof13.8%overthesamequarterlastyear.During9M2015,productionincreasedby12%to82.1thousandtonsand2.3billionpacks,a12%increaseonboththetonnageandpacksover9M2014.
Totalcakeproductionin3Q2015increased5.7%over3Q2014to16,514tons(atotalof521,000packs,a2.1%increaseover3Q2014).Thecakelinesoperatedatanaver-ageutilizationrateof91%,downfromthe100%utilizationratein3Q2014and93%in2Q2015,withthenewcakelinecommissionedinMarch2015operatingat84%utiliza-tion during 3Q2015.
Imported versus local direct material 3Q2014
Imported versus local direct material 3Q2015
Local Imported
Local Imported
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE16
Asexplainedearlier,therewasageneralrelativesofteninginthecakemarketduringthe3Q2015asreflectedintheACNielsenRetailAuditofthesegmentwherebythetotalcakemarketin3Q2015wasc.95%ofwhatitwasin2Q201510.AsperEdita’spolicy,wedonotkeepfinishedgoodsinventoryofmorethanthreedays,andhenceutiliza-tionrateswerebroughtdowntoreflectmarketdemand.Itmustbenotedthatdemandincakeshaspickedupastheback-to-schoolseasonstartedduringthelastweekofSeptember.However,theutilizationratesonthecakelineswillprobablynotreboundinstantaneouslygiventheupsizingoftheTwinkies(approximately37%oftotalcakesales)introducedattheendofSeptember,whichisthenormalcyclewhenupsizingproductsisinitiallyintroduced.
Totalcroissantproductionrecorded8,466tons,a22%increaseover3Q2014levelsand10%increaseversus2Q2015,reflectingtheincreasedcapacityofthenewlines.Totalpacksproducedincreased60.5%over3Q2014to200millionpacksreflectingtheincreasedcapacityintheMiniMoltosub-segment.Thecroissantlinesoperatedatanaverageutilizationrateof96%downfrom100%utilizationratein3Q2014reflectingthecapacityadditionsinspiteofthelongsnaglistonthecroissantlinecommissionedinApril2015thatprolongeditsramp-upphase.
Withintherusksegment,totalproductiondeclined27.8%in3Q2015to847,000tonsascomparedto3Q2014.Intermsofpacks,ruskproductiondeclinedby8.3%to25millionpacksy-o-y,yetremainedatthesameproductionlevelsas2Q2015.Itmustbenotedthatcomparedto3Q2014,Editahadimplementedsomedownsizingtotheruskpacks.Furthermore,during3Q2015,duetothegeneralshortageofbluecollarsonthemarket,Editawasforcedtodirectsomeofthelaborfromtherusklinetothecroissantsegment,targetingbettermanagementofresourcesgiventhecapacityexpansionsandstrongmarket demand for croissants.
Forthewafersegment,totalproductionreached17millionpackscomparedto11mil-lionpacksin3Q2014,butthisislowerthanthe28.3millionpacksproducedin2Q2015.Thistranslatedinto650tonsofproductionduringthequarter,a17%growthover3Q2014.Thedeclineismostlyattributabletotheseasonalityfactorandlowerdemandduringthesummerforcoatedwafers,whichconstituteapproximately80%ofEdita’swafersales.Accordingly,theuncoatedwafers,whichisasmallersizedSKU,werethemainrevenuedriverforthewafersegmentin3Q2015.
Forcandy,totalproductiongrewby68%to601tonsin3Q2015,correspondingto16millionpacks.Theintroductionofthe“Fakka”SKU(thelargerfamily-sizedpack)attheendof2014isthereasonthegrowthinpackswasonly47.0%whencomparedto3Q2014.
10PleasenotethatACNielsenRetailAuditsareconductedeveryothermonth.Accordingly,thetwomonthsendingJune2015andAugust2015wereusedasanindicationofthe2Q2015and3Q2015,respectively.
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE17
Thetablebelowshowsthecomparativeactualproductionperproductsegmentfor3Q2015ascomparedto3Q2014inbothtonnageandnumberofpacks:
3Q2014 3Q2015 Growth(%) 3Q2014 3Q2015 Growth
Cake 15,629 16,514 5.7% 510 521 2.1%Croissant 6,917 8,466 22.4% 125 200 60.5%Rusks 1,173 847 -27.8% 27 25 -8.3%Wafer 554 650 17.4% 11 17 47.7%Candy 358 601 67.9% 11 16 47.0%Total 24,630 27,078 10% 685 779 14%
ItisworthnotingthatthetotalnumberofemployeesintheIndustrialOperationsDivi-sionwas2,976,upfrom2,921in2Q2015.Thisshowsaminimalincreaseinnumberoflabor,despitecapacityadditionsyeartodate.ThisismostlyattributabletothestoppageofthreeTwinkieslinesasaresultoftheupsizing,aswellastheheadcountoptimizationprogram.Editacurrentlyhasalaborshortageofaround200bluecollars.ShortageoflaborincreasesmanufacturingoverheadsasitimpactsthemagnitudeofovertimepaidbytheCompany.
AnotherimportantissuetonotewithintheIndustrialOperationsDivisionisthatthenewrusklineintheE07factoryiscurrentlyintheinstallationphaseandisexpectedtostartcommissioning in the second half of December 2015.
OntheR&Dlevel,3Q2015sawthelaunchoftheMoltoMix,thedouble-filledcrois-sant,whichhassincegainedtractionandgreatcustomersatisfaction,surpassingthebudgetbycloseto400%.OnSeptember27,2015,EditalaunchedtheTwinkiesExtra–thelarger-sized,higher-marginTwinkies.Goinginto2016,R&Disintheadvancedtrialandfinalizationstagesofnewcroissantflavors,severalcakeproducts(bothnovelproductsdevelopedin-houseaswellastheadaptationofseveralcakeproductswhosetechnicalknowhowwasacquiredfromHostessBrands),severalnewflavorsofrusksandvariationsofthepate/strudel(thefirstofwhichistobelaunchedin1Q2016).
Human ResourcesEditacontinuestobecommittedtodevelopits5,360employeesbeingastrongbelieverinhumancapitalasthemaindrivingforcefortheCompany.TurnoverinEditaremainsverylowandiscurrentlyat1.75%.Havingsaidthat,Edita,aswiththeindustrialsector,hasbeenexperiencingshortagesinthebluecollaremployeeswithsome200vacancies.Asaresponse,EditacontractedseveralthirdpartiestosupplytheCompanywithlabor,afeatthathassofarhelpedeasetheshortage(alongwiththetrainingresultingfromtheemployee-optimizationprogramthathasbeenongoingsincelastyear).Inadditiontothat,ManagementhasenteredintoanagreementwiththeMinistryofSocialSolidaritytobepartoftheirprogramtoprovidejobsfororphans.Accordingly,andaspartofEdi-ta’sCSRprogram,theCompanyreceivesthecandidates,conductsaninitialassessmentandtrainsthosecandidatesitwillhire.ItisworthnotingthattotalemployeeswithintheIndustrialOperationsDivisioniscurrently2,976employees,upfrom2,921in3Q2014,inspiteoftheadditionofthreenewlines,thisbeingmostlyattributabletotheheadcountoptimisationprogramtheEditalaunchedin2014.
3Q2015 Earnings rElEasECairo, Egypt | 12 November 2015
3Q2015 Earnings rElEasE18
Investor Contacts
Ms.DinaEl-SonbatyVice-PresidentInvestorRelations&CorporateAffairs
T:+20238516464M:+201222187052dina.sonbaty@edita.com.eg
Ms.MennaShamsElDinInvestorRelations&BusinessDevelopmentManager
T:+2023851-6464M:+201001542428menna.shamseldin@edita.com.eg
About Edita Food IndustriesEdita,foundedin1996andheadquarteredinEgypt,isaleaderinthegrowingEgyp-tianpackagedsnack-foodmarket.TheCompanymanufactures,marketsanddistrib-utesarangeofbrandedbakedsnackproductsincludingpackagedcakes,croissants,rusks(bakedwheat)andwafersaswellasselectedconfectionary/candyproducts.TheCompany’slocalbrandportfolioincludeshouseholdnamessuchasTodo,Molto,BakeRolz,BakeStix,FreskaandMiMix.TheCompanyalsohasexclusiveownershipoftheinternationalHTTbrandsTwinkies,Hoho’sandTigerTailinEgypt,Libya,Jordan,Palestine,Morocco,Algeria,Tunisia,Syria,Lebanon,Iraq,Bahrain,Oman,theUAE,Kuwait,QatarandSaudiArabia,andispartytoatechnicalassistanceandknow-howagreementtomanufacture11additionalHTTbrandsacrossitsterritories.TheCompanyholdsstrongnumber-onemarketpositionsinitscorecakeandcroissantsegments,anumber-twomarketpositioninrusksandgrowingmarketpositionsinthewafersandcandysegments.In2014,theCompanyderivedc.94%ofitsrevenuefromEgyptandc.6%fromover14regionalexportmarkets.Learnmoreatir.edita.com.eg
Forward Looking StatementsThiscommunicationcontainscertainforward-lookingstatements.Aforward-lookingstatementisanystatementthatdoesnotrelatetohistoricalfactsandevents,andcanbeidentifiedbytheuseofsuchwordsandphrasesas“accordingtoestimates”,“aims”,“anticipates”,“assumes”,“believes”,“could”,“estimates”,“expects”,“forecasts”,“in-tends”,“isoftheopinion”,“may”,“plans”,“potential”,“predicts”,“projects”,“should”,“totheknowledgeof”,“will”,“would”or,ineachcasetheirnegativesorothersimilarexpressions,whichareintendedtoidentifyastatementasforward-looking.Thisapplies,inparticular,tostatementscontaininginformationonfuturefinancialresults,plans,orexpectationsregardingbusinessandmanagement,futuregrowthorprofitabilityandgeneraleconomicandregulatoryconditionsandothermattersaffectingtheCompany.
Forward-lookingstatementsreflectthecurrentviewsoftheCompany’smanagement(“Management”)onfutureevents,whicharebasedontheassumptionsoftheManage-mentandinvolveknownandunknownrisks,uncertaintiesandotherfactorsthatmaycausetheCompany’sactualresults,performanceorachievementstobemateriallydifferentfromanyfutureresults,performanceorachievementsexpressedorimpliedbytheseforward-lookingstatements.Theoccurrenceornon-occurrenceofanassumptioncouldcausetheCompany’sactualfinancialconditionandresultsofoperationstodiffermateriallyfrom,orfailtomeetexpectationsexpressedorimpliedby,suchforward-looking statements.
TheCompany’sbusinessissubjecttoanumberofrisksanduncertaintiesthatcouldalsocauseaforward-lookingstatement,estimateorpredictiontodiffermateriallyfromthoseexpressedorimpliedbytheforward-lookingstatementscontainedinthisprospectus.Theinformation,opinionsandforward-lookingstatementscontainedinthiscommuni-cationspeakonlyasatitsdateandaresubjecttochangewithoutnotice.TheCompanydoesnotundertakeanyobligationtoreview,update,confirmortoreleasepubliclyanyrevisionstoanyforward-lookingstatementstoreflecteventsthatoccurorcircumstancesthat arise in relation to the content of this communication.
Shareholder Structure as of 3Q15
Recommended