In the opening quarter of 2024, the CIEL Group unveiled a revenue of 8.8 billion. Marking a substantial 37% increase, after-tax profits mirrored the positive dynamics in the dazzling trio of sectors: Hospitality, Finance, and Health.
The CIEL Group has announced that the revenue for Q1 2024 reached 8.8 billion, reflecting a 2% decrease. This decline is primarily attributed to a 15% reduction in Textile sector revenues. However, the overall impact has been offset by robust performances in the Hospitality, Finance, and Health sectors.
The company reported increased profits for the first quarter ending on September 30, 2023. After-tax profits rose significantly by 37%, reaching Rs 946 million. Additionally, the EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) experienced a notable increase of 16%, reaching 1.5 billion. These positive financial results indicate a strong start to the fiscal year for the CIEL Group.
Free Cash Flow multiplied by over 4, reaching 1.2 billion, thanks to positive cash flows from the operational activities of the Hospitality, Textile, and Finance sectors.
Net interest-bearing debt decreased by 135 million in the first quarter, settling at 11.9 billion, resulting in a debt ratio of 27.8%.
Commenting on these results, Jérôme de Chasteauneuf, Group Finance Director of CIEL Limited, stated, “The first-quarter results reflect the relevance and agility of CIEL’s strategic positioning in a rapidly evolving macroeconomic context. Assuming market trends and operational conditions remain stable, we anticipate net profit growth in the first half of the current fiscal year.”
Hospitality
Despite traditionally lower activity in the first quarter, the Hospitality sector recorded a 17% increase in revenue to 1.8 billion compared to the same quarter in 2022. EBITDA progressed to 399 million from 308 million last year, driven by a significant improvement in the average daily rate amid inflationary pressures and labor shortages. The sector reduced its net financial expenses by 30% for the period. After-tax profit benefited, reaching 145 million, a significant improvement from the 14 million recorded in the same period of the previous fiscal year.
Textile
First-quarter Textile sector revenue stood at 4.4 billion, a 15% decrease primarily due to slowing demand and margin pressure. However, the “Shirts” segment in India remained strong, partially offsetting the sales reduction in other segments, notably the “Knit” activity. EBITDA decreased from 463 million to 370 million due to industry-wide challenges, especially price pressures in an inflationary environment and higher energy costs. Additionally, the sector’s financial expenses increased by 56%, mainly due to higher interest rates, resulting in a 44% reduction in after-tax profit to 150 million. The strategic partnership with SOCOTA in Madagascar reached a financial break even during this quarter.
Finance
CIEL Finance saw an 11% growth in revenue to 1.4 billion, supported by improved interest margins, leading to higher net financial results for BNI MADAGASCAR. EBITDA increased by 53% to 554 million compared to the same quarter of the previous year, primarily due to lower depreciation and financing costs (interest charges) at BNI MADAGASCAR during this quarter. After-tax profit increased by 72% to reach 402 million, considering the improved profit of Bank One, which amounted to 85 million compared to 52 million in the corresponding quarter of the previous year.
Health
With a revenue of 1.1 billion, a 20% increase from the first quarter of the previous year, the Health sector’s growth was driven by higher occupancy levels and increased core activities, particularly in Uganda. EBITDA increased by 16% to 230 million. During the quarter, a new clinic in Mont Choisy started its operations. The sector experienced higher depreciation and financial expenses due to significant investments in new facilities and the upgrading of existing ones, resulting in a 4% decrease in after-tax profit to 89 million.
Real Estate
The Real Estate sector’s revenue increased by 15% to reach 60 million, primarily driven by higher rental income at Evolis Properties. During this quarter, Phase 2 of the mixed-use Nouvelle Usine real estate program was launched and will be completed in the third quarter of this fiscal year. Additionally, on September 28, 2023, the Group secured a sustainable loan of 435 million for Ferney Development Ltd. This decision aligns with La Vallée de Ferney’s commitment to sustainable development as part of its “Tropical Agrihood” project, involving increased environmental and social reporting obligations.
Agro
CIEL recorded a 70% increase in the combined attributable profits of Alteo Limited and MIWA Sugar Limited, totaling 221 million. MIWA Sugar had a strong quarter due to improved margins from increased sales in Tanzania and strong operations in Kenya, driven by increased production, higher sales, and favorable pricing conditions in the country. Alteo’s real estate segment had lower sales than the previous year, mainly due to the cyclical nature of residential project deliveries. In agriculture, the company benefited from higher sugar prices, offsetting the negative impact of the late start to the 2022 harvest. Alteo’s profits were boosted by the positive evolution of the fair value of biological assets and reduced production and financial costs.