Qalaa Holdings [CCAP.CA] has announced its 3Q16 financial results, showing a net loss of EGP207.6mn compared to a net loss of EGP135.7mn in 3Q15. The company reported revenue of EGP1.79bn in 3Q16, up 21% Y-o-Y, while EBITDA was EGP85.7mn, down 32% Y-o-Y. It attributed its improved top line to a 25% increase in TAQA Arabia’s revenues and a 27% improvement in ASEC Holding’s revenues on a Y-o-Y basis. On the other side, management attributed the loss to: i) increased costs across the firm, which was further escalated post EGP flotation in 4Q16; ii) EGP35mn in provision expenses; and iii) impairment charges of EGP19.6mn. Qalaa Holdings Chairman and Founder Ahmed Heikal has mentioned that Qalaa's management was satisfied with the recent set of results noting that this shows the resilience of the subsidiaries given the challenging operating environment. He added that management is optimistic given the economic direction taken by the Egyptian government noting the following: i) ERC will benefit as the company will record USD denominated revenues once operational; ii) TAQA will capitalise on fuel subsidy cuts, which will enhance its margins; iii) mining businesses will benefit as they export the bulk of their production; and iv) Dina Farms will enjoy a net positive devaluation effect. Finally, Managing Director Hisham El-Khazindar pointed out that the company will be focusing on decreasing its foreign debt position on the holding level through exiting assets that would generate USD denominated funds, mentioning that Sudan’s Al-Takamol Cement and Algeria’s Djelfa Cement could be on their list. (Company Disclosure)