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GB Auto believes play a pivotal role in supporting funda-
mental and long-term growth in the market. We continue
to invest accordingly, despite a lack of short-term visibility
imposed by the nation’s current foreign currency situation
and procedural reforms.
Management has successfully closed an LE 960 million
capital increase to fund construction of two new facilities.
The first will be a wholly owned plant that will assemble mo-
torcycles and three-wheelers, whichmanagement believes to
be the first Bajaj plant outside of India. The second will be a
new tire-manufacturing facility to serve the MENA region’s
growing tires market. The two new facilities will expand GB
Auto’s opportunities in these fast-growing lines of business,
enhancing the group’s profitability and FX outlook in the
long term (via exports).
In addition to a continual focus on growth and investment in
long-term opportunities, management has also stressed ef-
ficiency. The company is accustomed to operating in a lean,
efficientmanner inall aspects of the business—a trait thatwill
serve us well as the country’s free trade agreements with the
EU and Turkey on import duties are fully implemented. These
agreements have already placed Chinese and South Korean
vehicles at a disadvantage, and management believes the full
implementationof the twopartnership agreements couldhave
a substantial negative impact on the market. The government
of Egypt appears to recognize the difficult position in which
automotive manufacturers and assemblers find themselves,
andmanagement continues to actively advocate for legislation
that protects domestic assemblers and the countless valuable
manufacturing jobs they support.
In the Passenger Car segment, management acknowledges
the downside risk to previous guidance arising from the
current national foreign-exchange crunch and a lack of
Group Revenues by Year
(LE million)
7,415.3
8,290.1
9,126.7
12,264.7
12,322.1
6,873.8
2010 2011 2012 2013
2015
2014
Group Gross Profit by Year
(LE million)
883.3
1,071.6
1,170.3
1,594.4
1,581.7
885.4
2010 2011 2012 2013
2015
2014
Passenger Cars
61.1%
Motorcycles and Three-Wheelers
16.3%
Commercial Vehicles and Construction Equipment 10.8%
Tires
2.6%
Financing Businesses
8.5%
Others
0.6%
Passenger Cars
49.7%
Motorcycles and Three-Wheelers
21.7%
Commercial Vehicles and Construction Equipment 11.0%
Tires
2.3%
Financing Businesses
14.7%
Others
0.6%
Revenue
Contribution by
LOB
Gross Profit
Contribution by
LOB
10 | GB Auto |
2015
Management Review and Financial Performance