Monthly Highlights: November 2022

•  North African stock exchanges were mixed as Egypt’s EGX30 (+14.8%) and Morocco’s Semdex (+3.1%) closed higher while Tunisia’s Tusise index (-1.4%) was lower
•  In East Africa, Kenya’s NSE20 was the worst-performing index in the region after losing -3.3%, followed by Mauritius (-0.6%), while Tanzania’s TSI gained +0.6%.
•  West African indices were broadly negative driven lower by Ghana (-3.4%) and Francophone region (-0.8%) with Nigeria (+8.3%) closing positive
•  Southern Africa exchanges posted mixed performances, with the Namibia (+9.0%), Malawi (+8.4%) and Botswana (+5.9%) closing higher
 

Frontier Africa markets closed mixed in November, with eight posting positive performance and seven negative performances in US dollar terms.  The Egypt EGX30 (+14.8%) was at the top of the leader board driven by positive performance from Alexandria Containers (+23.8%) and Telecom Egypt (+23.5%), followed by Namibia DSI (+9%), Malawi (+8.4%) and Nigeria (+8.3%), while the biggest laggards were Zimbabwe Industrials (-19.6%) dragged down by Willdale (-32.7%), Star Africa (-23.3%) and Axia (-21.5%), followed by Zambia LUSE (-4.6%), Ghana GSE (-3.4%) and Kenya NSE20 (-3.3%).

North African stock exchanges were mixed as Egypt’s EGX30 (+14.8%) and Morocco’s Semdex (+3.1%) closed higher while Tunisia’s Tusise index (-1.4%) was lower

North African stock exchanges were mixed as Egypt’s EGX30 (+14.8%) and Morocco’s Semdex (+3.1%) closed higher while Tunisia’s Tusise index (-1.4%) was lower. In Egypt, Rameda released positive 3Q22 (T/O: +21.2% y/y; PAT +56.0% y/y) driven by +47% y/y increase in the average unit price on the back of a partial impact from price increases from some of its products, a +6.8% y/y expansion in EBIT margin due to economies of scale and increasing contribution of the higher margin segments. Cleopatra Hospitals Group has signed an 18-year concession agreement for Haven Hospital. The hospital is one of Egypt’s state of the art physical therapy, long-term care and rehabilitation center of excellence facility. This move marks CHG’s first major presence in West Cairo in addition to its West Cairo Polyclinic. Medinet Nasr for Housing and Development reported impressive 3Q22 results (T/O: +188.9% y/y; PAT +1,314.8%) driven by a +446% y/y rise in gross contracted sales (Taji City (+575.6% y/y) and Sarai (+369.4% y/y)). . Commercial International Bank released positive 3Q22 results (G/E: +25.95% y/y ; PAT +15.9% y/y) as the increase in net interest income (+25.3% y/y) and noninterest income (+32.1% y/y) offset a +279.8% y/y increase in provisions. Orascom Development released mixed 3Q22 results (T/O: +50.1% y/y; PAT +21.1% y/y) driven by gains in Real estate net sales (+17% y/y), a +3.8% y/y expansion in gross profit margin which was offset by a +50.8% y/y increase in SG&A expenses. In Morocco, Mutandis released strong revenue growth in 3Q22 (+51.6% y/y) attributable to higher prices and higher volumes across all business categories. Revenue per category was as follows Detergents (+6.5% y/y), Seafood products (+69.5% y/y), Bottles (+57.4% y/y), Juice (+41.2% y/y) and Season brand (+118.8% y/y).

In East Africa, Kenya’s NSE20 was the worst-performing index in the region after losing -3.3%, followed by Mauritius (-0.6%), while Tanzania’s TSI gained +0.6%.

In East Africa, Kenya’s NSE20 was the worst-performing index in the region after losing -3.3%, followed by Mauritius (-0.6%), while Tanzania’s TSI gained +0.6%. In Kenya, Equity Group Holdings released mixed 3Q22 results (GE: +28.5% y/y; PAT +11.4% y/y) attributed to a +46.1% y/y increase in non-interest and a +15.6% y/y increase in net interest income which was offset by a +150.2% y/y growth in impairments. KCB Group also released mixed results for 3Q22 (GE: +15.0% y/y; PAT +11.5% y/y) this was as a result of a +30.7% y/y increase in non-funded income and a +5.4% y/y growth in net-interest income which was offset by a +18.3% y/y increase in operating expenses. Safaricom released poor 1H23 results (T/O: +4.8% y/y; PAT -18.4% y/y) as increased operating expenses (+32.2% y/y) and higher effective tax weighed down on profitability. However, excluding, Ethiopia the Kenyan operations grew earnings by a marginal +0.6% y/y. In Tanzania, Tanzania Breweries released poor 3Q22results (T/O: +14.9% y/y; PAT -3.9% y/y) due to a (+93.26% y/y) rise in finance cost. In Mauritius, MCB Group released strong 1Q23 results (GE: +29.8% y/y; PAT +24.0% y/y) as non interest income and net interest income grew by (+17.04% y/y) and (13.1% y/y) coupled by a (-13.7% y/y) decline in impairments.

West African indices were broadly negative driven lower by Ghana (-3.4%) and Francophone region (-0.8%) with Nigeria (+8.3%) closing positive

West African indices were broadly negative driven lower by Ghana (-3.4%) and Francophone region (-0.8%) with Nigeria (+8.3%) closing positive. while Ghana’s In Nigeria, GDP rose by 2.25% y/y in 3Q22, falling shy of estimates by economists surveyed by Bloomberg (2.9%) and also down by 1.78% relative to the growth rate recorded in 3Q21 (4.03%). International breweries reported disappointing 3Q22 results (T/O: +5.6% y/y; PAT N/A) this was as a result of (+17.0% y/y) and a (+9.9% y/y) increase in cost of sales and operating expenses respectively. Dangote Cement 9M22 results (T/O: +15.17%; PAT -23.41%) as volumes declined by -4.3% y/y, bringing the cumulative cement sales decline to -6.2% y/y coupled by higher cost of sales (+19.94% y/y) and higher operating costs (+41.96% y/y). Lafarge released mixed 9M22 results (T/O: +23.1% y/y; PAT +11.2% y/y) as strong top line growth was offset by +367.2% y/y rise in operating expenses.

Southern Africa exchanges posted mixed performances, with the Namibia (+9.0%), Malawi (+8.4%) and Botswana (+5.9%) closing higher

Southern Africa exchanges posted mixed performances, with the Namibia (+9.0%), Malawi (+8.4%) and Botswana (+5.9%) closing higher while Zambia and Zimbabwe closed lower. In Zimbabwe African Distillers Limited released 1H22 results (T/O: +368.8% y/y; PAT +651.8%) as the group benefitted from volume growth (+11.0% y/y) to approximately 69,071 litres coupled by a improvement in EBITDA margin (23.97% in 1H22 vs 19.99% in 1H21). EcoCash Holdings released weak 1H23 results (T/O: +164.0% y/y; PAT -55.9%) the bottom line was negatively impacted by forex exchange losses on debentures (+17,116.7% y/y) and higher effective tax rate of 58.0% up 40% for the prior period. Delta Corporation Limited released positive 1H23 results (T/O: +430.0% y/y; PAT +582.1% y/y) the sturdy operating performance was anchored by volume growth, higher local USD sales, replacement cost-based pricing, improved consumer demand, relaxed Covid-19 restrictions and improved efficiencies.