ElSwedy Electric Co., Egypt’s biggest publicly traded cables seller, reported an 82 percent drop in third-quarter profit as delays in government delays in approving equipment weighed on revenue.
Net income declined to 35 million Egyptian pounds ($5.7 million) from 196 million pounds in the same period a year earlier, the company said in a statement to the Egyptian bourse today. The net income figure missed estimates by investment banks Beltone Finance for a profit of 169 million pounds and EFG-Hermes for 135 million pounds.
Revenue from the company’s transformers business declined 61 percent “due to delays by the Egyptian government in testing and inspecting” power transformers, Tarek Yehia, ElSwedy’s investor relations manager, said by phone from Cairo.
ElSwedy’s turnkey projects revenue was down 54 percent due to delays in obtaining letters of credit for the company’s business in sub-Saharan Africa, he said. “Government bureaucracy is causing delays in obtaining signatures for the letters of credit in sub-Saharan Africa,” Yehia said.
ElSwedy’s shares rose 6 percent at the 2:30pm close in Cairo to 22.24 Egyptian pounds. Its shares have risen 7.2 percent for the year, compared with a gain of 32.7 percent for the benchmark EGX 30 index.