April 15th, 2008
Summary
▪AMOC Background and Operations
Alexandria Minerals Oils Company (AMOC) is a refinery producer operating through two
production complexes: I) Lube Oil Complex and II) Gas Oil Complex; producing a wide range of petroleum based products from light distillates to heavy ones. AMOC operates under the supervision of the Egyptian General Petroleum Company (EGPC), which is the single largest holder in the company. AMOC was established in 1997 and currently has a paid-in capital of EGP861 million distributed over 86.1 million shares with a par value of EGP10 per share.
▪1H07/08 Results: Margins Chopped!
Revenues grew 27.0% YoY in 1H07/08 to EGP2,741.7 million. Price growth for AMOC’s
products was the main contributor to growth in sales. COGS and other operating expenses
increased at a higher rate than revenues, which led to a declining profitability and margins. Raw materials, which represented more than 94% of COGS in 1H07/08 grew 37.6% YoY pulling down gross margins. Raw materials are purchased from EGPC, or its subsidiaries, at lower than international prices. Gross margin dropped from 23.6% to 18.0%, operating margin declined from 23.1% to 17.5%, and EBITDA margin as well saw a cut from 24.8% to 18.9%.