If you missed out on our webinar with Elsewedy Electric (SWDY), well Thndr Claps has got you covered with this summary of important talking points!
Several topics were discussed during the talk, including the company’s recent 9-month earnings, its expansion plans, & why its debt levels increased significantly.
Earnings
Despite economic challenges, Elsewedy managed to grow revenues by 53% & profits by 35% on a yearly basis for the first 9-months of 2022.
As for quarterly earnings, profits saw a much bigger jump of 71% year-over-year in Q3-2022.
The company said these results reflect the strong operational performance & serve as evidence of the diversified sectors & markets it operates in.
Emphasis on diversification
The company lauded its diversified business portfolio, whereby a slowdown in one business is made up for elsewhere by another business.
Here are Elsewedy’s businesses & their contribution to total revenues for the first 9-months of 2022:
- Wires & Cables: 50%
- Turnkey Projects: 40%
- Meters & Transformers: 8%
- Other: 2%
The company’s diversification extends to its 31 facilities across the world & over 100 countries that import its products.
This diversification also acts as a great source of foreign currency income, as 45% of the company’s revenues come from outside-of-Egypt sales.
Increased debt levels
Elsewedy’s debt levels increased significantly during the first 9-months of 2022, mainly due to how the company manages its inventory levels.
In response to global supply chain disruptions, Elsewedy now makes sure its inventory is filled with raw materials four months before their expected use. This is up from the normal stocking of one month prior to usage.
Another reason for rising debt is the company’s anticipation of an EGP devaluation, leading them to pay off its imports at a quicker rate before the USD became more expensive.
The company also used the money to expand its presence, with a transformer factory in Tanzania, an investment in the dry port project in 6th of October City, & developing the existing cable factories in Egypt & Saudi Arabia.
Despite the higher debt levels, the company stated it’s still at a healthy level as it’s supported by large quantities of inventory & a high level of demand.
Upcoming projects
Elsewedy considers itself the main partner in the government’s efforts for both infrastructure & renewable energy projects.
The company is also exploring venturing into green hydrogen, a major source of renewable energy.
