EFG Hermes, the leading financial services corporation in Frontier Emerging Markets (FEM), achieved net profit after tax and minority interest of EGP 358m in the third quarter (3Q) of 2019, up 34% y-o-y, and revenues of EGP 1.2bn, reflecting a 25% y-o-y increase, according to a statement on Tuesday.
The strong growth in revenue was driven by strong sell-side revenues, robust performance by the NBFI platform and capital market and treasury revenues, the statement mentioned.
“As we enter the last quarter of 2019, we are happy to report that the Group continues to post solid top and bottom line results as the Firm developed capabilities, products and services that will continue to support its revenue generation” said EFG Hermes Holding’s Group CEO Karim Awad.
“The strength of both our Investment Bank and NBFI platforms is proof positive that we have made significant headway into becoming a full-fledged financial services corporation, cementing our leadership position across the spectrum,” he said.
Fees and commissions, which represented 74% of the Group’s revenues this quarter, grew 13% y-o-y to EGP 872 million on the back of increased Brokerage and Tanmeyah revenues.
EFG Hermes’ sell-side businesses recorded an 11% y-o-y growth in revenues to EGP 490m in the third quarter of the year on higher brokerage revenues generated from Egypt, KSA and structured products – despite Investment Banking revenues posting a y-o-y decline due to a strong comparable quarter in 2018.
“The Brokerage division’s dominance in MENA markets and newly entered frontier markets continues to generate strong revenues for the Group,” said Awad.
“The division ended the first nine months of the current year as the leading brokerage house in Egypt, Abu Dhabi, Dubai, Nasdaq Dubai and Kuwait. I am particularly proud of the rapid growth rate in terms of market share in Sub-Saharan African markets, where we ranked second and third in Kenya and Nigeria respectively,” he noted.
Buy-side revenues declined 29% y-o-y to EGP 84m in 3Q 2019 due to lower regional management fees. Private Equity revenues came flat y-o-y in 3Q 2019.
NBFI revenues continued to climb, reporting a 41% y-o-y increase to EGP 299m in 3Q 2019 – particularly driven by Tanmeyah’s impressive 52% y-o-y revenue growth to EGP 252m in the third quarter of the year.
“We proactively built a strong and growing NBFI platform over the past few years as we continue to actively explore new venues for further expansion to lead the market with new products,’ said Awad.