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profitable business divisions. In particu-
lar, as the company continues to invest
in higher-margin activities management
foresees an improvement in net profit
margins, noting that we cannot foresee
the impact of extraordinary events.
The company’s ambitious investment
plans are set to start shortly after the
capital increase.
Latest Corporate
Developments
1) GB Auto Shareholders Approve
c.LE960 Million Capital Increase
GB Auto’s extraordinary general as-
sembly of shareholders approved a
c.LE960 million rights issue that will
see the company’s issued capital rise
to LE 1.095 billion. Proceeds from the
capital raising will be used to fuel the
company’s drive to grow its Tires and
Motorcycles & Three-Wheelers busi-
nesses, allowing GB Auto to build a
new two- and three-wheelers plant to
allow full CKD assembly; to deepen
the group’s presence in the tires line
of business through entering the tire
manufacturing business; and to pur-
sue additional expansion opportuni-
ties in select businesses.
2) GB Auto Ranks 2nd Place for In-
vestor Relations in Egypt
GB Auto was honored with a second-
place ranking in the “Best Company
for Investor Relations in Egypt in
2014” awards category at Middle East
Investor Relations Society’s Annual
Conference and Awards ceremony on
27 November 2014 at the DIFC Confer-
ence Centre in Dubai. Management
considers it noteworthy that there
was only a one percentage point dif-
ference between GB and the company
that took first place.
Moreover, GB Auto’s Investor Rela-
tions Manager, Hoda Yehia, was named
Best Investor Relations Professional in
Egypt for the year 2014.
The Awards, carried out in collabora-
tion with Thomson Reuters Extel, recog-
nize the efforts of regional companies and
IR professionals who play a critical role in
developing investor relations. The event
is the largest IR conference in the Middle
East and has been held annually for the
past five years. It is attended by delegates
from across the region and beyond.
Outlook
Given the fundamental strengths sup-
porting Egypt’s economy, including a
population of 90 million people, a key
geographic position and basket of free
trade agreements, GB Auto sees real
growth potential in the Egyptian market
and is continuing to invest accordingly.
In that vein, management has sought
and received approval for an LE 960
million capital increase to fund con-
struction of two new facilities. The first
will be a wholly-owned plant that will
assemble motorcycles and three-wheel-
ers, which management believes to be
the first of its kind outside of India for
Bajaj. The second will be a new tires
manufacturing facility. Both plants will
open new opportunities for GB Auto in
these fast-growing lines of business.
2014 Highlights
Group Revenues by Year
(LE million)
Group Gross Profits by Year
(LE million)
35.0
%
Revenue Increase
FY10
6,873.8
885.4 883.3
1,070.0
1,170.3
1,581.7
7,416.3
8,290.1
9,126.7
12,322.1
FY10
FY11
FY11
FY12
FY12
FY13
FY13
FY14
FY14
GB Auto’s revenue rose 35.0% to LE
12,322.1 mn in FY14
174.0
mn
Net Income
Net income was LE 174.0 mn in FY14, a
50.0% rise over FY13
36.3
%
Improvement
Passenger Cars revenue saw a 36.3%
improvement year-on-year in FY14
1.3
bn
Motorcycles & Three-Wheelers Revenue
Motorcycles &Three-Wheelers revenue
increased 8.5% in FY14 to LE 1.3 bn
89.8
%
CV&CE Revenue Increase
Commercial Vehicles & Construction
Equipment revenues rose 89.8% in FY14
415.2
mn
Tires Revenue in FY14
Tires revenues were LE 415.2 mn in
FY14, a 6.4% improvement y-o-y
722.7
mn
Financing Businesses Revenue
Revenues of LE 722.7 mn in FY14 were a
49.0% improvement y-o-y
27.4
mn
Others Revenues
The Others line of business revenues
registered at LE 27.4 mn in FY14
1.4
%
Net Profit Margin
GB Auto’s net profit margin was 1.4% in
FY14, a slight increase y-o-y
Ghabbour Auto | 2014 ANNUAL REPORT
9