Very thin transactions are the main feature of the Egyptian stock market these days with average daily turnover ranging between LE500-700 million. Khaled Serri Siam, the newly appointed head of the local bourse, told reporters last week that the relatively limited liquidity in the market is due to the summer lull and Ramadan, the fasting month that is usually accompanied by a weak volume of activity.
ORASCOM CONSTRUCTION INDUSTRIES (OCI): The regional company with activities in both the construction and fertiliser producing sectors posted a 41 per cent increase in second quarter net profits compared to the same quarter of last year, to reach LE801.1 million.
"While the Egyptian Fertiliser Company [EFC] reported weaker results as a result of softer urea prices, OCI Nitrogen capitalised on the strong pricing environment for nitrate-based fertilisers offsetting the impact of urea prices," OCI said.
Analysts attribute the increased profits to the increase in the price of nitrate fertilisers. During the quarter, OCI finalised the acquisition of Royal DSM Agro and Melamine businesses, the assets rebranded OCI Agro and OCI Melamine -- collectively referred to as OCI Nitrogen. The revenues realised by OCI Nitrogen made up for the weaker results of EFC caused by lower urea prices.
EFC has already completed several urea shipments through OCI Nitrogen's sales and distribution networks to key European markets such as France, Germany, the Netherlands and the UK.
As for construction activity, the value of OCI's backlog of unfinished projects declined by 3.4 per cent from the end of March to $6.3 billion, stung by a weaker Euro.
"The demand for infrastructure remains strong in our core regional markets. The Construction Group has several outstanding bids for sizeable infrastructure projects across the region with outcomes expected prior to year-end," said company CEO Nassef Sawiris in a company release.
Infrastructure work made up over two-thirds of new awards. The group declared a cash dividend of $1 per share to be paid in September.
SOUTH VALLEY CEMENT (SVC): The planned acquisition by SVC of Golden Pyramids Plaza, owner of the City Stars megamall, in Cairo came to a halt after the latter's shareholders rejected the deal. The deal would have been executed via a share swap.
South Valley approved a LE15 billion capital increase in May to buy Golden Pyramids Plaza, in a bid to diversify its operations outside of cement.
The reasons the shareholders of Golden Pyramids, which has investments in real estate and tourism projects and a fair value estimated at LE15 billion, rejected the share swap were not revealed.
TALAAT MUSTAFA GROUP (TMG): The prosecutor-general closed the investigation filed by 45 members of parliament over a land sale between a former housing minister and Talaat Mustafa Group.
This means the terms of the contract between the group and the New Urban Communities Authority (NUCA), a body under the Housing Ministry, are valid. Under the agreement TMG will pay LE13 billion for the allocated land to NUCA.
The investigations were based on accusations of NUCA wasting public money when it sold the land for the Madinaty Project to the group.
The local investment bank, CI Capital, said the development is positive for TMG as the initial court decision negatively impacted Madinaty unit sales. CI Capital raised TMG's target price to LE10.2 per share.
TMG is Egypt's largest listed developer and Madinaty is one of its main projects. The site will include homes, schools, hotels and a golf course on 8,000 feddans on Cairo's outskirts.
SIXTH OF OCTOBER DEVELOPMENT AND INVESTMENT COMPANY (SODIC): The real estate developer will start building two new compounds in its East town project in Qattamiya.
The first compound, Esplanade, includes housing apartments on 160,000 square metres while the second will comprise administrative and commercial complexes on 80,000 square metres.
The overall investment cost of the two projects is LE1.5 billion.
EZZ STEEL: The local and regional steel giant witnessed its profits almost triple in the second quarter of 2010 compared to the same period of 2009.
The company's net profit came at LE136 million compared with LE37 million in the same quarter last year thanks to strong domestic demand.
The firm said a return to production at its flat- steel plant, suspended in late 2008 due to a collapse in the world market, also reflected positively on results.
CITADEL CAPITAL: The leading private equity group may sell at least one investment by year-end and list its energy unit, Taqa, by June 2010.
The Cairo based firm, which controlled $8.3 billion in investments as of June, made its last full exit on an investment in June 2007 with the sale of Egyptian Fertilisers to a group of investors led by Dubai-based Abraaj Capital for $1.41 billion. Citadel's initial 2005 investment in the fertiliser producer was less than $400 million.
Citadel, which invests in energy, mining, cement, agriculture, transportation and retail businesses across the Middle East and East Africa, posted a second-quarter loss of LE95 million ($16.7 million), the second consecutive quarterly loss since the company listed on the Egyptian exchange in December.
Compiled by Sherine Abdel-Razek