Egyptian vehicle assembler and distributor GB Auto (AUTO.CA) said on Wednesday its net income grew 74.2 percent year-on-year in the fourth quarter, but forecast the local car market would shrink in the coming year.
Fourth-quarter net income rose to 75.90 million Egyptian pounds ($11.3 million), despite what Chief Executive Raouf Ghabbour said was a “truly volatile environment”, while revenue was up 25.4 percent to 2.35 billion.
Earnings before interest and tax (EBIT) reached 205.2 million pounds, a 55.5 percent increase. GB Auto ended the year with 28.9 percent of the Egyptian passenger car market, down slightly from a year earlier.
Egypt is beset by a political and economic crisis, with foreign exchange in increasingly short supply.
“Egypt’s foreign exchange environment and the expected deterioration of the macro (economic) climate in a high-inflation environment will see the Egyptian passenger car market shrinking in the coming year,” Ghabbour said in a statement.
However, he added that new North African business should make an immediate positive contribution.
“We are confident that our strategy for this year will see us post bottom-line growth and improve our margins in Egypt, while seeing both Algeria and Libya making positive contributions to profitability from year one, essentially providing buffers to challenges in our home market.”