(Photo by Hassan Ibrahim\ DNE)
Chairman and managing director of the Egyptian Chemical Industries Company (KIMA) Eid Al-Hout has announced that Italian firm Technoment will begin the construction of “Fertilizer Factory – KIMA2″ in Aswan to produce ammonia and urea fertilisers by the end of 2014.
Italy’s Technoment Company won the tender for implementing the fertilisers project in 2011 after fighting off strong competition from other global companies. The project was originally scheduled for July 2011, but the 25 January Revolution prevented its completion.
Technoment received the project land in Aswan in September, where it carried out the expansion of roads and gates to begin the actual implementation of the project after the arrival of the equipment in December.
It is expected to begin production by early 2018, with investments totalling $592m and the project will produce 1,200 tonnes of ammonia per day, and 1,530 tonnes per day of urea added Al-Hout.
Al-Hout announced that Technomet and KIMA are currently working on a factories rehabilitation project, to ensure its facilities work using natural gas. This includes the development of the nitric acid production department, and a nitrogen production department and sub-department, with the investment totalling approximately $138m. It is scheduled to complete this project within three years, in parallel with work on the fertiliser factory.
Al-Hout said that the investment cost of the company’s current projects total $730m, with banks covering over 50% of the total. The rest of the costs come via self-financing schemes in addition to a capital increase derived from an Initial Public Offering.
Al-Hout stated that the company recently decided to withhold its dividend to be used in a capital increase to finance the current projects.
KIMA’s ordinary public assembly approved in October distribution of proposed profits, after making adjustments include a 5% statutory reserve . The adjustments take into account that the shareholders share amount to EGP 80m with an employees’ share totalling EGP 15.4m.
KIMA announced in a statement that the capital increases went from EGP 1.89bn to EGP 1.97bn through funding from the shareholders’ share of the revenues of the last fiscal year, with an increase of EGP 142.8m.
KIMA’s collected business results during the first quarter (Q1) of the current fiscal year (FY) 2014-15 revealed that net profit amounted to EGP 15.1m, compared to EGP 7.8 m with an increase of 93.5%. In addition, revenues amounted to EGP 66.5m compared to EGP 70.4m.
The ownership structure of KIMA is distributed across several companies, including: a 55.72% share of the Chemical Industries Holding Company (CIHC); a 25.63% share in Social Insurance Fund for Governmental Sector Workers; 3.34% in the Egyptian Endowments Authority (Awqaf); and 3.14% in the Postal Saving Fund.
The company has investments in companies floated on the Egypt Stock Exchange, namely 6.46% in Delta Sugar and 2.7% in Abu Qir Fertilizers.
The current KIMA capital totals EGP 1.89bn, divided across 378m shares with a nominal value of EGP 5. The market capitalisation of shares in the stock market amounts to approximately EGP 3bn.
