1st Quarter Results
October 02 2003 - 2:01AM
UK Regulatory
RNS Number:4393Q
EFG-Hermes Holdings SAE
1 October 2003
Press Release Cairo, 30th September 2003
EFG-Hermes 1Q2003 Consolidated Results and Analysis
EFG-Hermes 1Q2003 Consolidated Results and Analysis
Our total revenues increased 10% to EGP34.9 million in 1Q2003 from EGP31.7
million in the same period last year. Net profit for 1Q2003 was EGP3.1 million,
down from EGP6.3 million in 1Q2002. The drop in net profit was mainly due to the
unusual loss from available for sale investment of EGP6.1 million. However,
normalized net profit after capital gains profits amounted to EGP6.2 million,
which is only 8% lower than last year. On the other hand operating revenues
decreased by 24% to EGP21.6 million down from EGP28.4 million in 1Q2002.
Operating Revenues
The contributions of different EFG-Hermes divisions to operating revenue can be
broken down as follows:
Operating Revenue
The drop in operating revenues came in on the back of the drop in private
placements through brokerage, which dropped 78% and an 11% drop in investment
banking revenues, which were affected by the political and economic turbulence
in the region during the first quarter.
Revenues from brokerage increased 17% despite the 27% drop in the company's
volume. Excluding low margin fixed income trading, which accounted for a large
portion of total trading volume in 2002, our net brokerage volume rose by 86%
while on the other hand the overall market volume (net of fixed income trading)
dropped by 53%. The following table illustrates the volumes in fixed income and
equity brokerage.
Operating Costs
Our general and administrative (G&A) expenses increased slightly by 4% to
EGP11.6 million; however, they remain in line with our cost reduction policy.
G&A expenses as a percentage of revenues dropped from 35.2% in 1Q2002 to 33.3%
in 1Q2003. Over the last two years we have been decreasing our G&A expenses,
which dropped from EGP87.4 million in FY 2000 to EGP50.9 million in FY 2002.
Non-operating Revenues
Dividend income rose sharply to EGP5.7 million in 1Q2003 up from only EGP26,000
in 1Q2002. Last year's dividend income started to show in from 2Q2002.
Although we were able to realize capital gains of EGP3.1 million in 1Q2003, this
was more than offset by EGP6.1 million in losses incurred from sale of available
for sale investments resulting in a net capital loss of EGP3.0 million. In
1Q2002 we realized a capital loss of EGP0.4 million.
Interest Expense
Bank interest dropped slightly by 1% to EGP12.6 million.
Please find attached a copy of 1Q2003 consolidated financials and notes. For
further information please contact:
Tarek El Shawarby
Investor Relation Department
Tel: +202 3361-606
Fax: +202 3361-536
tshawarby@efg-hermes.com
Ramsay Zaki
CFO
ramsay@efg-hermes.com
Hesham Khalil
Assistant to the CFO
hkhalil@efg-hermes.com
EFG-Hermes may make or publish forward-looking statements about management
expectations, strategic objectives, business prospects, anticipated expense
savings and financial results, and other similar matters. A variety of factors,
many of which are beyond EFG-Hermes' control, could cause actual results and
experience to differ materially from the expectations expressed in these
statements. These factors include, but are not limited to, financial market
volatility, actions by competitors, the effect of current and future legislation
or regulation, and certain other factors.
Readers are cautioned not to place undue reliance on forward-looking statements,
which speak only as of the date on which they are made. EFG-Hermes does not
undertake to update such statements to reflect the impact of circumstances or
events that arise after the date these statements were made.
EFG - Hermes Holding Company
Consolidated Financial Statements
&
Review Report Thereon
As Of March 31, 2003
REVIEW REPORT
To The Board Of Directors Of The
EFG-Hermes Holding Company
We have reviewed the accompanying consolidated statement of financial position
of EFG - Hermes Holding Company and Subsidiaries as at March 31, 2003, and the
related consolidated statements of income, changes in equity and cash flows for
the three months then ended. These financial statements are the responsibility
of the company's management. Our responsibility is to issue a report on these
financial statements based on our review.
We conducted our review in accordance with the Egyptian Standard on Auditing
applicable to review engagements. This standard requires that we plan and
perform the review to obtain moderate assurance as to whether the consolidated
financial statements are free of material misstatement. A review is limited
primarily to inquiries of company's personnel and analytical procedures applied
to financial data, and thus provides less assurance than an audit. We have not
performed an audit and, accordingly, we do not express an audit opinion.
Based on our review, nothing has come to our attention that causes us to
believe that the accompanying consolidated financial statements do not give a
true and fair view in accordance with the Egyptian Accounting Standards.
Without qualifying our opinion, the company has included an amount of L.E. 4
723 008 in the revenue for the period ended on March 31,2003, representing
dividend income from one of its investments for 2002. Such dividend was
proposed by the investee's board of directors in March 2003 and approved by the
general assembly in July 2003.
KPMG Hazem Hassan
Cairo, July 31,2003
EFG - Hermes Holding Company
Consolidated Statement of Financial Position
as of March 31,2003
Note No. 31/3/2003 31/12/2002
LE. LE.
Current Assets
Cash on hand and with banks
Cash on hand 485 991 61 522
Cheques under collection 344 859 5 967 600
Banks - current accounts 21 132 092 23 900 380
Banks - time deposits (5) 81 318 247 161 795 543
L/G's margin 25 100 25 100
Total cash on hand and with banks 103 306 289 191 750 145
Trading investments 116 492 009 114 551 892
Accounts and notes receivable
(net of provision) (8,16) 195 889 683 245 036 139
Debtors and other debit balances (6,16) 198 903 712 189 129 203
Other brokerage companies-
Misr Clearance Co. 7 399 906 9 254 010
Total current assets 621 991 599 749 721 389
Long Term Assets
Fixed assets (net) (9) 24 127 552 25 120 273
Available-for- sale investments (10) 431 515 683 464 952 083
Investments in associates (11) 4 625 000 4 625 000
Held - to - maturity investments
(Arab Bank Bonds) (3-9) 501 500 501 500
Settlement Guarantee Fund 7 413 451 6 667 685
Deferred expenditures (net) 1 702 656 1 821 088
Total Long Term Assets 469 885 842 503 687 629
Total assets 1 091 877 441 1 253 409 018
Current Liabilities
Banks - overdraft (15) 235 086 541 283 265 023
Accounts receivable - credit balances 55 250 197 185 592 574
Creditors and other credit balances (7) 19 348 601 17 987 614
Provisions (8) 12 013 555 12 013 555
Total current liabilities 321 698 894 498 858 766
Shareholders' equity
Paid - in capital (13) 205 370 050 205 370 050
Legal reserve 104 538 493 104 399 917
General reserve 158 271 158 271
Special reserve- share issuance premium 183 376 983 183 376 983
Special reserve -revaluation differences 8 534 694 7 322 222
Retained earnings 110 810 561 98 985 059
Shareholders' equity 612 789 052 599 612 502
Net profit for the period/year 3 136 464 14 928 536
Total shareholders'
equity including net profit 615 925 516 614 541 038
Minority interest 644 531 627 077
Total shareholders' equity and
minority interest 616 570 047 615 168 115
Long term liabilities
Long term loans (14) 153 608 500 139 382 137
Total shareholders'
equity and long term liabilities 1 091 877 441 1 253 409 018
The accompanying notes from No. (1) to No. (17) form an integral part of the
financial statements and are to be read therewith . and are to be read
therewith.
Chairman Managing Director Review Report "Attached"
KPMG Hazem Hassan
Public Accountants & Consultants
EFG - Hermes Holding Company
Consolidated Income Statement
for the financial period ended on March 31, 2003
For the financial For the financial
Note period ended period ended
No. 31/3/2003 31/3/2002
L.E. L.E.
Income from fees,
commission and
managing investments 21 624 336 28 363 399
Interest earned on time
deposits 1 862 451 2 158 084
Bonds interest 147 173 872 424
Dividend income 5 682 322 26 372
Gains from sale of
trading investments 2 510 972 1 824
Unrealized gains (losses)
on trading investments 594 930 (417 722)
Gains (losses) from sale
of fixed assets 1 925 (7 570)
Currency differences gains
(losses) 574 881 (944 811)
Other income (16) 1 888 165 1 625 694
Total revenues 34 887 155 31 677 694
Less:
General adminstrative
expenses 11 606 010 11 268 343
Consultantion fee 452 707 362 021
Bank interest 12 565 651 12 631 878
Provisions - 229 687
Available -for- sale
investments'
revaluation
differences 40 472 -
Losses from sale of
available -for- sale
investments 6 094 866 -
Fixed assets depreciation (9) 854 393 895 959
Deferred expenditures
amortization 118 432 95 905
Total expenses 31 732 531 25 483 793
Net profit before
minority interest 3 154 624 6 193 901
Minority interest (18 160) 61 668
Net profit for the period 3 136 464 6 255 569
The accompanying notes from No. (1) to No. (17) form an integral part of the
financial statements and are to be read therewith .
EFG - Hermes Holding Company
Consolidated Statement of Changes in Equity
For the financial period ended on March 31, 2003
Share Legal General Special Reserve Special Reserve Retained Total
Capital Reserve Reserve share issuance Revaluation Earnings
premium Differences
L.E. L.E. L.E. L.E. L.E. L.E. L.E.
Balance at
1/1/2002 205 370 050 104 119 873 158 271 183 376 983 - 105 905 118 598 930 295
Special
reserve -
revaluation
differences - - - - 7 322 222 - 7 322 222
Transfer to
reserves - 280 044 - - - (6 920 059) (6 640 015)
Balance at
31/12/2002 205 370 050 104 399 917 158 271 183 376 983 7 322 222 98 985 059 599 612 502
Special
reserve -
revaluation
differences - - - - 1 212 472 - 1 212 472
Transfer to
reserves - 138 576 - - - 11 825 502 11 964 078
Balance at
31/3/2003 205 370 050 104 538 493 158 271 183 376 983 8 534 694 110 810 561 612 789 052
The accompanying notes from No. (1) to No. (17) form an integral part of
the financial statements and are to be read therewith.
EFG - Hermes Holding Company
Consolidated Statement of Cash Flow
For the financial period ended March 31, 2003
31/3/2003 31/12/2002
LE. LE.
Cash Flows from Operating Activities
Net profit for the period before minority
interest 3 154 624 6 193 901
Adjustments to reconcile net profit to net
cash provided by operating activities
Fixed assets depreciation 854 393 895 959
Provisions - 229 687
Available -for- sale investment's
revaluation differences 40 472 -
Deferred expenditures amortization 118 432 95 905
(Gains) losses on sale of fixed assets (1 925) 7 570
Gains from sale of trading investments (2 510 972) -
Losses from sale of available -for- sale
investments 6 094 866 -
Unrealized (gains) losses on trading
investments (594 930) 417 722
Foreign currency translation differences 185 412 -
Operating profit before changes in working
capital 7 340 372 7 840 744
Increase in debtors & other debit balances (16 910 676) (383 613)
Increase in creditors and other credit
balances 7 637 342 1 064 074
Decrease in accounts receivable
-(debit balances) 49 067 583 121 256 385
Decrease in accounts receivable
- credit balances (130 342 378) (141 964 277)
Decrease (increase) in affiliated companies
(debit balances) 60 029 321 (16 353 142)
(Decrease) increase in affiliated companies
(credit balances) (64 787 350) 15 042 106
Decrease in other brokerage companies
- Misr Clearance 1 854 104 20 354 269
Decrease in trading investments - 2 502 093
Net cash (used in) provided from operating
activities (86 111 682) 9 358 639
Cash Flows from Investing Activities
Fixed assets purchases (53 247) (219 217)
Proceeds from sale of fixed assets 193 909 98 298
Purchases of available -for- sale investments (448 815 150) (22 086 781)
Purchases of investment in associates and
subsidiaries (1 320 000) -
Proceeds from redemption & sale of available
-for- sale investments 481 185 363 20 962 047
Proceeds from redemption of company's share
in Settelment Guarantee Fund - 476 374
Payment to increase the company's share in
Settelment Guarantee Fund (745 766) (2 130 470)
Net cash provided from (used in) investing
activities 30 445 109 (2 899 749)
Cash Flows from Financing Activities
Increase in paid - in capital 1 500 000 -
Increase in retained earnings - 6 966 000
Paid dividends (350 000) (7 382 093)
(Decrease) increase in banks - overdraft (48 153 646) 54 874 600
Increase (decrease) in long term loans 14 226 363 (18 770 663)
Decrease in short term loans - (43 354 780)
Net cash used in financing activities (32 777 283) (7 666 936)
Net change during the period (88 443 856) (1 208 046)
Cash and cash equivalent at the beg. of the
period 191 750 145 102 412 163
Cash and cash equivalent at the end of the
period 103 306 289 101 204 117
The accompanying notes from No. (1) to No. (17) form an integral part of the
financial statements and are to be read therewith .
EFG - Hermes Holding Company
Notes to the Consolidated Financial Statements
for the financial period ended on March 31, 2003
1. Purpose of Preparation
The consolidated financial statements and accompanying notes were prepared
for the purpose of submitting them to the London Stock Exchange as one of the
requirements of Global Depositary shares (GDS).
2. General
- EFG - Hermes Holding Company -Egyptian Joint Stock Company- was founded in
pursuance of decree No. 106 of 1984.
- The company's extraordinary general meeting held on July 22, 1997 resolved
to adjust the company's status and convert it in pursuance to the provisions of
law No. 95/1992 and its executive regulation and amend the company's purpose to
become participation in the companies establishment which issue securities or in
increasing their share capitals.
- EFG- Hermes holding company, the parent company, owns the following
subsidiaries:
Direct Ownership Indirect Ownership
% %
Financial Brokerage Group (FBG) 99.76 .04
Egyptian Fund Management Group (EFMG) 84.23 11.49
Egyptian Portfolio Management Group (EPMG) 66.33 .33
Hermes Securities Brokerage 97.58 2.42
Hermes Fund Management 89.96 10.04
Hermes Corporate Finance * 100 0
EFG - Hermes Advisory Inc. 100 0
Hermes Financial Management (Egypt) Ltd. 100 0
EFG - Hermes for Promoting & Underwriting 99.67 0
Bayonne Enterprises Ltd. - 100
EFG -Hermes & Hermes Ltd. - 84
EFG- Hermes (UK) Limited - 100
EFG- Hermes Fixed Income 99 1
EFG- Hermes Private Equity 96.3 3.7
* The parent company purchased .5 % of the shares in Hermes Corporate Finance
Co. through irrevocable sales contracts. The transfer of title was not
executed due to a restriction on the transfer of the shares. The transfer of
title of the shares will be executed when the restrictions on the transfer of
shares are lifted, however for accounting purposes the HCF Company was
consolidated as a subsidiary as it is demonstrated that the parent has
effective control over these shares.
3 . Significant Accounting Policies Applied
The significant accounting policies adopted in the preparation of these
consolidated financial statements are set out below:
3-1 Basis of Preparation of Financial Statements
The financial statements were prepared in accordance with
Egyptian Accounting Standards, and applicable local laws and
regulations.
3-2 Principles of Consolidation
The consolidated financial statements include all subsidiaries
that are controlled by the parent company. The basis of the
consolidation are as follows:
- All intragroup balances and transactions are eliminated.
- Minority interest, in the equity and results of the
entities that are controlled by the parent company , is
shown as a separate item in the consolidated financial
statements .
- The cost of acquisition is allocated as follows:
a) The fair value of the assets and liabilities acquired as
of the date of the exchange to the extent of the
parent's interest obtained in the exchange, and
b) The minority's proportion of the pre-acquisition
carrying amounts of the assets and liabilities of the
subsidiary.
3-3 Foreign Currencies Transactions
- The company maintains its accounts in Egyptian Pounds. Transactions
denominated in foreign currencies are recorded at the prevailing exchange rate
at the dates of transactions.
Balances of monetary assets and liabilities denominated in foreign currency
at the balance sheet are translated at the prevailing exchange rates. The
exchange differences are recorded in the income statement.
- Assets and liabilities of financial statements for foreign companies were
translated using the prevailing exchange rates on the financial position date,
shareholders' equity items are translated using historical rates, while revenues
and expenses were translated using an average of the prevailing rates during the
financial year. The resulted translation differences were included within the
shareholders' equity in the statement of financial position as a special
reserve- foreign currency translation differences.
3-4 Fixed Assets Depreciation
Fixed assets are recorded at the historical cost, and are depreciated by the
straight line method over the estimated productive life for each type
of asset at the following:
Useful Life
- Building 33.3 Years
- Office furniture & electrical appliances 5-16.67 Years
- Vehicles 3.33 - 4 Years
- Computer equipment 3.33 - 5 Years
- Fixtures 3 Years
3-5 Amortization of deferred expenditures
The cost of obtaining long term loans is capitalized and amortized over the loan
period (Note No. 14).
3-6 Trading Investments
Trading investments are valued on the basis of prevailing market value at the
balance sheet date and the revaluation differences are recorded in the income
statement.
3-7 Investments in Associates
Investments in associates are valued at cost. However, when there is an
impairment in the market or computed value of the investments compared to book
value, the book value should be adjusted with the impairment value and charge
the impairment to the income statement.
3-8 Available -for- sale Investment
- Available -for- sale investments are recorded at cost. Actively quoted
investments are revalued at cost or market value whichever is lower and non
quoted investments are valued at cost or computed value of the investments
(based on latest certified financial statements) whichever is lower and the
resulting decline in value is charged to income statement.
- Concerning the nonactive available for sale securities (don't have quoted
market price in an active market) and whose fair value can not be reliably
measured, such investments are recognized at cost. However, when there is an
impairment in the market or computed value of the investments compared to book
value, the book value is adjusted with impairment value and charge the
impairment to the income statement.
3-9 Held -to -Maturity Investments (Bonds)
Held - to- Maturity investments (Bonds) are recorded at cost. However, when
there is an impairment in value of these investments, it charged to the income
statement.
3-10 Taxation
- A tax provision has been formed to meet tax obligations based on detailed
studies for each claim.
- Due to the nature of the Egyptian tax laws and legislations,
applying the principles of the deferred taxes according to the International
Accounting Standard "taxes on Income" will not usually result in material
deferred tax liabilities. Further, if this application results in a deferred
tax assets, it will be recognized in the financial statements whenever there is
a sufficient comfort that these assets will be realized in the foreseeable
future.
3-11 Cash Flow Statement
For the purpose of preparing the Cash Flow Statement, cash and cash equivalent
are represented in the cash on hand, cheques under collection, current accounts
& time deposits with banks and L/G's margin.
4. Financial Instruments and management of related risks:
The Company's financial instruments are represented in the financial assets
and liabilities. Financial assets include cash balances with banks, investments
and debtors while financial liabilities include banks - overdraft and creditors.
Note (No. 3) of notes to financial statements includes significant accounting
policies applied regarding basis of recognition and measurement of the important
financial instruments and related revenues and expenses by the company to
minimize the consequences of such risks.
4/1 Market Risk:
Market risk is represented in the factors which affect values, earnings and
profits of all securities negotiated in stock exchange or affect the value,
earning and profit of a particular security.
According to the company's investment policy, the following procedures are
undertaken to reduce the effect of this risk.
- Performing the necessary studies before investment decision in
order to verify that investment is made in potential securities.
- Diversification of investments in different sectors and industries.
- Performing continuous studies required to follow up the company's
investments and their development.
4/2 Foreign currency risk
The foreign currency exchange risk represents the risk of fluctuationin
exchange rates, which in turn affects the company's cash inflows and outflows as
well as the value of its foreign currency assets and liabilities. As of the date
of the balance sheet the company has foreign currency assets and liabilities
equivalent to L.E. 299 665 059 and L.E. 252 734 607 respectively. The
company's net exposure in foreign currencies is as follows:
Surplus/ (Deficit)
L.E.
U.S. Dollar 67 238 054
Euro (20 341 057)
Sterling Pound 33 455
- As disclosed in note 3-3, the company has used the prevailing exchange rates
to revaluate monetary assets and liabilities at the balance sheet date.
- The company executes SWAP agreements to cover its required needs of
foreign currencies and meet the risks of exchange and interest rates related
thereto.
4/3 Financial Instruments Fair Value
The financial instruments fair value do not substantially deviated from
their book value at the balance sheet date, according to the valuation basis
applied, in accounting policies to the assets and liabilities, which
included in the notes to the financial statements. Note No. 10, 11 of the notes
to financial statements discloses the fair values of investments, which are,
reported at cost.
5. Banks - time deposits
The Banks - time deposits item includes an amount of LE 68 707 039 as blocked
deposits to guarantee the facilities granted by the Banks to the subsidiary
company (Financial Brokerage Group) under the guarantee of the parent
company- EFG - Hermes Holding Company.
6. Debtors and Other Debit Balances
31/3/2003 31/12/2002
L.E. L.E
Deposits with others 233 030 238 128
Down payments to suppliers 316 569 316 569
Prepaid expenses 818 045 1 019 992
Employees advances 489 627 465 681
Accrued revenues 13 113 137 4 499 483
Taxes withheld by others 2 178 559 2 016 857
Commercial International Investment
Company (CIIC) * 53 000 000 53 000 000
Commercial International Investment
Company (CIIC) - other 42 886 928 28 999 322
El Mansour & El Maghraby for Investment
And Development Company * 45 000 000 45 000 000
Eiad Mazhar Saleh Malas * 2 000 000 2 000 000
Unrealized swap gains 540 047 18 489 442
Down payment to purchase investments ** 14 711 200 13 571 600
Flemming CIIC Securities 1 501 111 -
Flemming El- Mansour Securities 16 124 -
Sundry debtors 22 099 335 19 512 129
198 903 712 189 129 203
* The balances represent payments to fully purchase of the capital shares of
Fleming CIIC- Holding. (Note No. 16). The required procedures to carry out the
transaction in the Stock Exchange are under processing.
** The balance represents down payment to purchase 75% of Financial Transaction
House (FTH) capital shares.
7. Creditors and Other Credit Balances
31/3/2003 31/12/2002
L.E. L.E
Tax Authority 9 106 908 10 016 261
Social Insurance Association 114 934 117 008
Arab Int. Company 1 360 000 1 360 000
Accrued expenses 2 890 377 2 790 734
Unearned revenues - 77 755
Accrued interest 3 111 801 1 927 763
Sundry creditors 2 764 581 1 698 093
19 348 601 17 987 614
8 . Provisions
Contingent
Provision for Liability Severance Tax claims
doubtful provision pay provision provision
debts
L.E L.E L.E L.E
Balance as at 1/1/2003 2 454 247 9 885 064 52 219 2 076 272
Balance as at 31/3/2003* 2 454 247 9 885 064 52 219 2 076 272
* * It is deducted from accounts receivable item in the balance sheet.
9. Fixed Assets
Office
Furniture,
equipment &
Electrical Computer
Particulars Land Building Appliances Equipment Vehicles Total
LE LE LE LE LE LE
Balance as at 1/1/2003 5 360 000 13 685 823 11 254 836 7 259 989 1 683 691 39 244 339
Additions during the
period - - 17 629 35 618 - 53 247
Disposals during the
period - - (23 537) - (265 000) (288 537)
Total cost as at
31/3/2003 5 360 000 13 685 823 11 248 928 7 295 607 1 418 691 39 009 049
Accumulated depreciation
as at 1/1/2003 - 1 519 771 6 401 091 5 212 964 989 828 14 123 654
Depreciation during the
period - 102 643 398 859 275 894 76 997 854 393
Disposals accumulated
depreciation - - (18 938) - (77 612) (96 550)
Accumulated depreciation
as at 31/3/ 2003 - 1 622 414 6 781 012 5 488 858 989 213 14 881 497
Net cost as at
31 /3 /2003 5 360 000 12 063 409 4 467 916 1 806 749 429 478 24 127 552
10. Available for sale investments
31/03/2003 31/12/2002
L.E L.E
Quoted investments 174 783 897 174 824 369
Non-quoted investments 256 731 786 290 127 714
431 515 683 464 952 083
- The market value of the quoted investments amounted to L.E 136 407 878 on
March 31,2003 versus L.E. 151 122 748 on December 31,2002.
11- Investments in associates
Investments in associates companies represent the value of the non-quoted
investments amounted to LE.4 625 000 as at March 31,2003 versus L.E. 4 625 000
as at December 31,2002.
12- European Investment Bank Contract:
According to the contract signed between EFG- Hermes - Holding Company and
the European Investment Bank dated March 1, 2001, EFG- Hermes Holding Company
purchases investments in its name in favor of the bank in a range of 5 Million
Euro for each investment. The total amount of these investments is limited to
25 Million Euro and the participation of European Investment Bank is limited
to 50% of total investment. This contract is valid until August 30, 2013. The
European Investment Bank pays the value of these investments. The proceeds is
reported as a liability to the company versus the investments reported as an
asset. An off-setting is made between the asset and liability at the balance
sheet date. The investments purchased according to this contract amounted to
LE 38 507 298 the equivalent amount of Euro 10 601 054 which are as follows:
Balance as of 31/3/2003
Equivalent in
L.E Euro
Gas & Energy Group Limited 8 104 041 2 391 054
Founoon Holding Co. (BVI) 16 984 000 5 000 000
Commercial International Investments
Company (CIIC) 13 419 257 3 210 000
38 507 298 10 601 054
13. Capital
The company's issued and paid - in capital LE 205 370 050 distributing into
41 074 010 shares of par value L.E. 5 per share.
14- Long term loans
- A loan contract has been signed on March 28, 2001 between EFG- Hermes
Holding Company and International Finance Corporation (IFC), this contract
provides for that EFG- Hermes Holding borrows a long term loan amounting to
USD 30 Million for five years ending on May 31,2006 with two years grace year
and annual floating interest rate over Libor based on the return on equity.
This loan will be used in financing the company's expansions in the Middle
East and North Africa besides new activities. According to the loan contract
the company has received the first installment amounting to US$ 15 Million on
May 15, 2001.
The loan principle is payable on 7 semi annual installments amounted to
US$4 285 700 each. Starting from May 15,2003 and interest will be due semi
annually on 15 May and 15 November, the first interest is due on 15 November
2001.
The loan contract stipulated to provide the following guarantees.
- An irrevocable power of attorney from the Borrower and the borrower's
subsidiaries to IFC enabling IFC to create at will (a) a first - ranking real
estate mortgage over the land and the building owned by Financial Brokerage
Group S.A.E. (subsidiary of 99.76 share percentage) at 58 El Tahrir Street,
Dokki - Giza, Arab Republic of Egypt and (b) a first - ranking commercial
mortgage on the tangible and intangible assets of the Borrower and
Borrower's subsidiaries.
Including such asset as may be acquired after the signature of this agreement;
- An irrevocable and unconditional guarantee by the Egyptian guarantors
and EFG- Hermes Advisory Inc. in a form acceptable to IFC for the benefit of IFC,
payable on first demand by IFC to guarantee the Borrower's payment obligations
to IFC under this agreement;
- A pledge of the shares that the Borrower holds in Egyptian Portfolio
Management Group S.A.E. to IFC (with par value of LE. 1 990 000).
On March 13, 2002, the company paid an amount of US$ 4 144 630 to the IFC as a
partial repayment of the loan. Accordingly, the loan balance amounted to
US$ 10 855 370 as of March 31, 2003 (the equivalent amount of LE. 61 658 500)
as will as, on May 15, 2003, the company has paid an amount of US$ 1 550 762
(Equivalent amount of L.E 9 102 173).
- On January 4, 2002, a loan contract has been signed between EFG - Hermes
Holding Company and the Foundation of (DEG)- DEUTSCHE INVESTITIONS- UND
ENTWICKLUNGSGESELLSCHAFT MBH. The said contract provides for that EFG- Hermes
Holding Company borrows a long term loan with amount of EURO 15 Million with an
applied annual floating interest rate. The loan principle is to be repaid on
12 semi annual installments of 1 250 000 Euro each. The first installment will
due on May 15, 2003 and the loan interest is due semi annually on 15 May, and
15 November, The company is committed to render some guarantees to the lender as
stipulated by the contract.
On July 4, 2002 the company has received an amount of EURO 10 420 000 , and
Euro 4 580 000 on December 24,2002 (the equivalent amount of LE. 91 950 000 as
of March 31,2003) representing the full amount of the mentioned loan.
On May 15,2003, the company has paid an amount of Euro 1 250 000 (the
equivalent amount of L.E 8 137 500) to DEG as a partial payment of the loan.
15. Contingent Liabilities and Commitments
- The Holding Company undertakes the credit facilities granted from the
banks to its subsidiaries - Financial Brokerage Group and Hermes Securities
Brokerage.
- The company has executed SWAP contracts with some Banks which will be
settled according to specific rates for the foreign currencies implied in such
contracts. The mentioned contracts are as follows:
Transaction date Transaction operation Amount currency Expiry Date
19/3/2003 Selling Euro 12 Million L.E 17/4/2003
19/3/2003 Selling USD 9 Million L.E 1/4/2003
19/3/2003 Selling USD 4 Million L.E. 2/4/2003
16. Related Party Transactions
- Debtors and other debit balances (Note No.6) include an aggregate
balance amounted to LE. 100 Million paid to CIIC, El Mansour and El Maghraby for
Investment and Development and Eiad Malas (who participated in the share capital
of EFG-Hermes Holding Company with percentages of 32.8% , 6.8% and 0.3%
respectively on July 8, 2001) for purchasing all the shares of Fleming CIIC -
Holding and also include L.E. 42 868 928 due from Commercial International
Investment Company (CIIC).
- Accounts receivable debit balances item includes an amount of L.E.
approximately 18 million due from Commercial International Investment Company
(CIIC) for Investments.
- Other income item includes an amount of LE. 1 887 605 represents
consulting fees received from Commercial International Investment Company (CIIC).
17. Comparative figures
Certain comparative figures have been reclassified to conform with the current
period classification.
This information is provided by RNS
The company news service from the London Stock Exchange
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