Al Ezz Gds Regs Regulatory News (AEZD)

The following amendment has been made to the 1st Quarter Results announcement released on 24 July at 07.00 under RNS No 9916J

Date should have been 24 July in first sentence

All other details remain unchanged

ezzsteel REPORTS CONSOLIDATED Q12013 RESULTS

Cairo, 24 July 2013 - ezzsteel (EGX: ESRS; London Stock Exchange: AEZD), the largest independent producer of steel in the MENA region and market leader in Egypt, today announced its consolidated results for the period ending 31 March 2013. The audited results have been prepared in accordance with Egyptian Accounting Standards.

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Key highlights

*EBITDA = sales - cost of goods sold - selling & marketing expense - G&A expense + depreciation and amortisation

** EPS = Net profit after tax & Minority Interest / No. of shares at the end of the period 

Comment

Commenting on the results, Mr Paul Chekaiban, Chairman and Managing Director of ezzsteel, said:

"Following two very difficult years in Egypt and in the global steel industry, the results of the first quarter in 2013 represent a turning point for ezzsteel.Not only have all the operational indicators turned positive, but, more importantly, we have secured the financing for the restart of our investment plan.

"ezzsteel is back on track with the implementation of our strategic industrial vision that has been the key for our success over the past 20 years."

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ezzsteel

About ezzsteel

Ezzsteel is the largest independent steel producer in the Middle East and North Africa, and the Egyptian market leader, with a total actual capacity of 5.8 million tonnes of finished steel.

In 2012, the Company produced 3.9 million tonnes of long products (typically used in construction) and 893,000 tonnes of flat products (typically used in consumer / industrial goods). ezzsteel's customer base is geographically diversified, with flat products mainly directed to export markets, whereas long products are sold in the domestic market. ezzsteel deploys the latest in modern steel making technology and is committed to further increasing vertical integration across its plants, to boost operational flexibility.

Operational Review

All of the below financial breakdowns are based on ezzsteel's consolidated financials, which include the financial performance of ESR/ERM, EZDK and EFS.

Sales & Production

Consolidated net sales for Q1 2013 were EGP 5.6 billion, which represents an increase of 7.4 per cent year on year. This increase in sales is due to higher sales volumes, as well as higher realized selling prices.Long product prices increasedby 2.5 per cent year on yearin the local market, while flat steel export prices increasedby 3 per cent, reflecting the slight improvement witnessed in international steel markets.

Long steel products accounted for EGP 4.4 billion or 79 per cent of sales in Q1 2013,while flat steel products represented 20 per cent of sales at EGP 1.1 billion. The domestic market continued to remain strong,with private house building leading the demand for ezzsteel's long products. Long product exports accounted for 7per cent of total long sales value.Flat product exports accounted for 46per cent of total flat sales.

Long steel sales volumes reached 1.0 million tonnes during Q1 2013, 7.5 per cent higher than the 937,356 tonnes sold during the same period last year.

Flat steel sales volumes fell by 2per cent to 266,764 tonnes in Q1 2013, principally due tothe switching of production at EFS to long products, to meet higher local demand and more attractive pricing.

The group's consolidated sales volumereached a total of1.3 million tonnes inQ1 2013, an increase of 5.4 per cent from the1.2 million tonnessold in Q1 2012, resulting from the increased production of long product at EFS following the commissioning of the long product mill.

The contributions of ESR/ERM, EZDK and EFS to the consolidated net sales for the period ending 31 March 2013 were 27 per cent, 62 per cent, and 11 per cent respectively.

Long steel production volumes totalled 1.0 million tonnes during Q1 2013,in line with Q1 2012.Flat steel production volumes increased by 3.6 per cent to 259,468 tonnes for the period, compared to 250,480 tonnes in the previous year.

Cost of Goods Sold

Consolidated Cost of Goods Sold for Q1 2013 represented 86 per cent of sales, reflecting a significant improvement in gross profit margin from 9 per cent in Q1 2012 to 14 per cent in Q1 2013.

EFS'sCost of Goods Sold, at 109per cent, reflectsthe low capacity utilization level currently at that facility.

Gross profit

Gross profit of EGP760 million was recorded for Q1 2013, an increase of 60 per cent from the EGP 475 million recorded in Q1 2012.

EBITDA

EBITDA for Q1 2013 amounted to EGP777million, representing an increase of 44per cent from EGP 538 million in Q1 2012.

Tax

The company's tax charge increased4 per cent from EGP122 million in Q1 2012 to EGP128 million in Q1 2013.

Net profit after tax and minority interests

Net profit after tax and minority interests was EGP 202 million for Q12013, in comparison to a profit of EGP 18 million for Q1 2012.

Liquidity and capital resources

At the end of the period, ezzsteel had cash on hand of EGP1.6 billion and net debt of EGP8.2 billion. The company has a gearing of Net Debt / Equity of 1.2 times.

Post-period developments

In June, ezzsteel announced it had successfully agreed the deferral by one year of EGP 220 million principal payments originally scheduled in 2013 relating to its EGP 440 million bond maturing in 2014.

It subsequently announced that it has signed an EGP 550 million, six-year, top-up syndicated loan facility with National Bank of Egypt, BanqueMisr and a group of local banks. The total syndicated loan is now EGP 2.8 billion.

These funds raised will be used to complete the construction of the Direct Reduced Iron (DRI) project at Sokhna-Suez. The cost of this investment is EGP 3.7 billion, of which EGP 2.8 billion will be financed through debt and the remaining amount through internal cash flows.

Outlook

The outlook for the second half is positive, with a stronger global steel market supporting profitability, notwithstanding slightly higher raw material costs. The Egyptian market continues to see robust local market demand for long products in particular, underpinned by house building activity.

Divisional Overview

- Ends -

Disclaimer:

This press release is issued by ezzsteel (formerly: Al Ezz Steel RebarsS.A.E.)the "Company", in connection with the disclosure of the Company's financial results for the 3 month period ending31March2013.This press release includes forward-looking statements. These forward-looking statements include all matters that are not historical facts. In particular, the statements regarding the Company's strategy, the expected strength of demand for long and flat products in Egypt and in regional and international markets, and other future events or prospects are forward-looking statements. Recipients of this document should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties and other factors that are in many cases beyond the control of the Company. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance and the Company's actual results of operations, financial condition and liquidity, and the development of the industry in which the Company operates may differ materially from those expressed in or implied by the forward-looking statements contained in this document. The cautionary statements set forth above should be considered in connection with any subsequent written or oral forward-looking statements that the Company, or persons acting on its behalf, may issue. Various factors could cause actual results to differ materially from those expressed or implied by the forward-looking statements in this document including worldwide economic trends, global and regional trends in the steel industry, the economic and political climate of Egypt and the Middle East and changes in the business strategy of the Company and various other factors. These forward-looking statements reflect the Company's judgment at the date of this document and are not intended to give any assurances as to future results. The Company undertakes no obligation to update these forward-looking statements, and it will not publicly release any revisions it may make to these forward-looking statements that may result from events or circumstances arising after the date of this document. None of ezzsteel, any of its directors, officers or employees or any other person can give any assurance regarding the future accuracy of the information set forth herein or as to the actual occurrence of any predicted developments. Furthermore, none of such parties shall assume, and each of them expressly disclaims, any obligation (except as required by law or the rules of the ESE, the LSE or the FSA) to update any forward-looking statements or to conform these forward-looking statements to ezzsteel's actual results.