CAIRO: Egypt’s Oriental Weavers, the world’s biggest machine-woven carpet maker, expects 5-6 percent growth in net profits in 2012 as oil prices stabilize and it expands into new export markets, a company official said on Monday.
The firm also expects improvement in its second-half profits over the first half of 2011 as raw material costs have declined, Investor Relations Manager Haitham Abdel Moneim told the Reuters Middle East Investment Summit.
"Sixty-five percent of the firm’s production is exported. We expect a 12 percent growth in exports this year and this will reflect on our profits," Abdel Moneim said.
The firm, which exports to 130 countries, posted a 4.4 percent drop year-on-year in second-quarter net profit to LE 58 million ($9.7 million). First-quarter net profit slid 15 percent to LE 82.3 million.
"I expect … growth of 5-6 percent next year (2012)," he said. "We aim for expansions into new markets such as West Africa and countries like Kazakhstan and Uzbekistan. We see strong growth opportunities in those countries."
"This year’s third- and fourth-quarter results will be better than the first half. The prices of raw materials have dropped since August and this will reflect on results."
He added that stabilizing oil prices would also boost 2012 profits. The firm’s main raw material is polypropylene.
Oriental Weavers aims to invest about LE 1 billion over the next five years, including expanding its factories in Egypt and the United States, as well as its factory in China which it hopes will contribute 10 percent of the firm’s total sales within five years, Abdel Moneim said.
