Ongoing Restructuring Effort Sees EFG Hermes Swing to
Normalized 4Q2013 Profit; Non-Cash Charges from
Balance Sheet Clean-Up Cause Impact Statutory Bottom
Line
The Group reports a 302% Y-o-Y increase in net operating profit in 4Q, with
both the Investment Bank and the Commercial Bank being profitable. The firm
reports a normalized net profit of EGP 96 million in the final quarter of 2013.
27 March 2014
(Cairo, Egypt) —EFG Hermes*, the leading investment bank in the Arab world, reported
today its financial results for the fourth quarter and full year 2013. The firm closed 4Q2013
with a normalized net profit after tax and before minority interest of EGP 96 million on
operating revenues of EGP 637 million. On a full-year basis, the Group reports a 102% rise in
normalized net profit after tax and before minority interest to EGP 427 million on revenues of
EGP 2,165 million.
The balance sheet clean-up resulted in EGP 715 million in non-cash, one-time charges below
the net operating profit level. Including these charges and other one-off operating expenses,
EFG Hermes Holding reports a statutory net loss after tax and before minority interest of
EGP 335 million.
Notably, both the Investment Bank and the Commercial Bank were profitable at the operating
level in both 4Q and FY2013.The Investment Bank posted a net operating profit of EGP 18
million in 4Q2013 (against a net operating loss of EGP 60 million in the same period last
year) and of EGP 30 million on a full-year basis (versus a net operating loss of EGP 23
million in FY2012). The Commercial Bank, meanwhile, reported a net operating profit of
USD 53.0 million in 4Q2013 (up 14% year on year) and of USD 191.3 million on a full-year
basis (up 4% year on year).
The firm’s management is optimistic that the year just-ended represents a turning point in the
development of EFG Hermes post the Arab Spring. Notably, the Investment Bank turned netoperating-profit positive in both the fourth quarter and on a full-year basis. Meanwhile, the
combined impact of both the firm’s sharp emphasis on cost optimization and the second
phase of its balance-sheet clean-up sees it entering 2014 with both a clean balance sheet and a
lean P&L that should see it close FY14 with an opex base in line with our previously
communicated target.
*
Cairo HRHO.CA • London: HRHOq.L • Bloomberg: EFGH • Reuters pages:
EFGS.HRMS.EFGI.HFISMCAP.HFIDOM
www.efghermes.com
EFG Hermes turned in an outstanding operational performance across all lines of business in
2013 extending its leadership.
Key Operational Highlights

Securities Brokerage remained the number-one ranked broker by market share of
executions on the Egyptian Exchange (EGX) and maintained a leading position in
other regional markets. Brokerage operations closed the year on a strong footing, with
total executions rising 11% Q-o-Q to USD 7.1 billion in 4Q2013 and reaching USD
27.2 billion in FY2013, higher 46% than a year earlier.

EFG Hermes Investment Banking closed five transactions in 2013, including the
landmark EGP 600 million right issue for Palm Hills Developments in Egypt, which
saw the launch for the first time in Egypt of tradable rights on the EGX. Also in 2013,
the Division advised Wadi Degla for Investments on a USD 43 million private
placement and Japan Tobacco International on an Egyptian acquisition. The team also
counselled Dubai Group on the USD 164 million sale of Dubai First to First Gulf
Bank and executed the technical listing of the Bank of London and the Middle East
(BLME) on the Nasdaq Dubai. The division continues to build a strong regional
pipeline of deals for execution in 2014.

Assets under management (AUM) grew 3% at EFG Hermes Asset Management,
largely on the back of a 6% appreciation in market effect. Equity funds / portfolios,
both in Egypt and regionally, performed well in 4Q2013.

AUM at EFG Hermes Private Equity stood at USD 0.7 billion. The team is
negotiating a number of exits that would potentially provide solid returns to investors
as well as significantly contribute to the firm’s profitability.

The region’s award-winning Research house closed 2013 once again ranked number
one overall in the Euromoney Research Poll. The Division covers 120 equities
representing c. 58% of the aggregate regional market capitalization, with further
coverage of 11 economies from a macro perspective and eight in terms of regular
strategy notes.

Net income after tax at Crédit Libanais, the firm’s Commercial Banking arm, rose
71% year-on-year in 4Q2013 to USD 16.8 million, resulting in an after-tax return on
average equity of 12.1%. Despite a very challenging business environment due to
regional developments, Crédit Libanais continues to deliver stable results while
further strengthening its capital base and streamlining its liquidity profile.
To view the EFG Hermes’ FY2013 and 4Q2013earnings with audited financials click here.
—Ends—
www.efghermes.com
Notes for Editors:
About EFG Hermes
Established in 1984, EFG Hermes is the leading investment bank in the Arab world. The
Firm specializes in Securities Brokerage, Investment Banking, Asset Management, Private
Equity and Research. EFG Hermes is listed on both the Egyptian and London stock
exchanges. The recent acquisition of a 65% stake in Credit Libanais marks the first step
towards EFG Hermes’s transformation into a universal bank and will enable it to rapidly
expand into retail and commercial banking.
Through its operations in Egypt, Jordan, Kuwait, Lebanon, Oman, Qatar, Saudi Arabia and
the UAE, with more than 800 employees of 25 nationalities, EFG Hermes serves a
considerable and diversified client base from the Middle East and North Africa to Europe,
Africa and the United States. Our clients include governments, corporations, financial
institutions, high net worth clients and individual customers.
For further information about EFG Hermes, please visit www.efghermes.com and stay
connected with us:
For further information, please contact:
EFG Hermes Media
[email protected]
May El Gammal
Head of Marketing
[email protected]
Note on Forward-Looking Statements
In this press release, EFG Hermes may make forward looking statements, including, for example, statements
about management’s expectations, strategic objectives, growth opportunities and business prospects. These
forward-looking statements are not historical facts but instead represent only EFG Hermes’ belief regarding
future events, many of which, by their nature are inherently uncertain and are beyond management’s control
and include among others, financial market volatility; actions and initiatives taken by current and potential
competitors; general economic conditions and the effect of current, pending and future legislation, regulations
and regulatory actions. Accordingly, the readers are cautioned not to place undue reliance on forward-looking
statements, which speak only as of the date on which they are made.
www.efghermes.com