LONDON: EFG Hermes announced that its operating revenue for the second quarter (Q2) of 2016 stood at EGP 288m, up 10% year-on-year (y-o-y). The increase came due to higher fee and commission income, rising contributions from the company’s leasing business, revenues from the recently acquired microfinance player Tanmeyah.
The company said that it completed the sale of the majority of EFG Hermes’ stake in Crédit Libanais during Q2 of 2016, unlocking considerable value for EFG Hermes shareholders. The company added that the concluded sale of 44.3% of Crédit Libanais has resulted in the full deconsolidation of Crédit Libanais from EFG Hermes’ financials.
EFG Hermes’ consolidated results for the quarter do not reflect the EGP 525m gain from the Crédit Libanais sale, as the amount is only considered on the company’s standalone financial statements. EFG Hermes is continuing its effort to divest its remaining 19.5% stake of Crédit Libanais shares. EFG Hermes Group CEO Karim Awad said that the company’s revenue mix in Q2 includes important contributions from both EFG Hermes Leasing and Tanmeyah in the context of non-bank financial services. Awad added that the company will continue building its non-bank financial services into Egypt’s premier offering in the category.
“Revenue growth was driven by our strategy of allocating capital to the building of our non-bank finance services in Egypt as we focused in tandem on growing our traditional capital markets business across the region,” Awad noted. EFG Hermes continued to maintain a flexible cost structure in Q2 of 2016, keeping employee expenses as a percentage of revenue below the 50% mark, as has been the group’s target since 2014.
