Impressive growth in revenue and earnings
EMFD reported solid 1Q22 revenue of EGP2.6 billion, up 66.6% y/y and down 25.7% q/q, supported by revenue in Mivida, which constituted 74.0% of total revenue, followed by Marassi at 20.8%, Uptown Cairo at 4.8%, and hospitality at 0.4%.
Gross profit in 1Q22 reached EGP1.3 billion, up 105.1% y/y and down 20.6% q/q, leading to a GPM of 49.5%, higher annually and sequentially.
Net profit in 1Q22 grew 198.9% y/y and 21.2% q/q to EGP1.6 billion, supported by finance income of EGP772.2 million, up 240.7% y/y, giving way to a significantly higher NPM of 61.5%.
Receivables, including off-balance sheet receivables, increased from EGP31.5 billion at the end of 4Q21 to EGP32.6 billion at the end of 1Q22.
Net cash increased from EGP11.5 billion at the end of 4Q21 to EGP12.2 billion at the end of 1Q22.
Given EMFD’s healthy results and strong net cash position, we maintain our Overweight recommendation based on our FV of EGP4.79/share. EMFD’s net cash position is currently 2.5% higher than its market cap.