Egytrans registers 40% growth in net profit
Egytrans group revenues increase by 35.8% during 2021 compared to previous year
By Eman Hamed
Egytrans, a leading transport and logistics company, announced annual results for 2021, detailing its financial performance progress and strategic approach in terms of achieving growth volumes and increasing revenues through providing world-class services to customers. “We achieved remarkable results for 2021 despite the ongoing COVID-19 impact on the global freight market, in addition to the cost increase of all transportation and freight operations in the Middle East by 437% as a result of the large deficit in containers as well as the increase in global demand for goods,” stated Abir Leheta, Chairman & CEO of Egytrans, revealing that with the strong and professional management Egytrans enjoys in dealing with the negative effects of crises, the company has been able to intensively enhance their marketing and sales capabilities over the past year through the continuous expansion of the service offerings as part of the strategy developed over the last two years.
Leheta added: “Marketing and sales were among the most important functions that we focused our attention on throughout the year, given the positive impact they’ve been proved to make worldwide, especially during the 2021 crisis. Part of those marketing improvements was updating and launching the company’s website. We were also keen to intensify our active presence in important trade fairs and conferences, the most recent of which was our participation in the EGYPS 2022 Oil and Gas Conference and Exhibition. We have also supported our Egytrans teams with specialists and experts to provide more advanced operations across all sectors.”
During the last quarter of 2021, Egytrans was able to increase the number of customers and expand the volume of business by concluding a number of new deals and agreements, which was positively reflected on the final outcome of the financial results for 2021. This large movement in activities has led to an increase in selling, general and administrative expenses, which is expected to improve in the long term.
Egytrans group revenues for 2021 reached EGP 293.5 million, representing an increase of 35.8% Y-o-Y. As a result, net profits after taxes for the year increased by 40% reaching EGP 18.3 million, registering a net profit margin of 6.2% vis-a-vis a margin of 6% in 2020. This marginal improvement in Net Profits was achieved by our continued emphasis on operational improvement and search for investment expansion opportunities, in addition to improved performance in 2021 in core business areas such as Logistics & Land Transportation.
Egytrans’ separate revenues reached EGP 264.4 million showing a strong growth of 39.3% Y-o-Y. In the meantime, operation costs increased by 33.9% to EGP 215.4 million while SG&A added 29.8% to EGP 46.7 million. As a result, net operating profit reached EGP 2.3 million in 2021 from last year’s EGP 7 million loss. Net profits after Taxes increased by 33.7% to EGP 18.5 million in 2021 vis-à-vis EGP 13.9 million a year ago, representing Net Profit Margins of 7% and 7.3% for both respective periods. Meanwhile, Earnings per Share (EPS) reached EGP 0.59 for 2021 compared to 0.3 in 2020.
As a result of the complexities of the heavy transport market with its cyclical nature and strict operating schedules, as well as the slowdown of mega projects in the market due to the impact of the pandemic on businesses, ETAL projects business slightly decreased by 5.5% Y-o-Y, recording lower revenues of EGP 21.2 million over 2021 compared to EGP 22.4 million in 2020. The impact of COVID-19 on the mega -infrastructure projects market has led to a drop in ETAL net profits after taxes to EGP -0.3 million in 2021 compared to EGP 1.8 million in 2020.
Egytrans ISO Tank Depot solutions business recorded a 35.9% increase in its 2021 net profits after taxes to USD 0.766 million vis-a-vis USD 0.564 million in 2020. On the top level, revenues recorded an increase of 7.5% to USD 1.55 million as opposed to USD 1.44 million in 2020. The company continues on track holding 70% of the market share in ISO tank storage and cleaning solutions.
Regarding Egytrans outlook for 2022, Leheta said: “Despite the progress we have achieved in our annual financial results for 2021, our outlook for the near future still carries a lot of caution, especially with the political tensions the world is witnessing, such as the Russian-Ukrainian war, which led to a rise in fuel prices and global inflation rate. In addition to the ongoing negative impact of the shipping crisis on the global and local economy, which in turn leads to a further increase in transportation prices and global supply chain costs, all of this further complicates the situation and the business environment.
Leheta highlighted that there is still a positive side to things, which in her opinion was reflected in the strategy set by Egytrans to continue operating in under any circumstances and achieve tangible positive results. However, she expects that supply chains would stabilize by the end of 2022, despite the continued surge in prices and delay in freight forwarding.
Leheta confirmed that Egytrans is proceeding with its organizational restructuring plans during the coming period, in addition to its relentless pursuit of business opportunities, as the company is set on studying new markets, simplifying operations, injecting new investments, creating new capabilities, achieving sustainable revenues and profits, and continuing to provide the finest services to its customers. Egytrans also maintains its belief in the enormous economic potential of the transport and logistics sector, especially in light of the considerable economic development Egypt is witnessing, which will position it as the largest trading country in the region.