GIH 1H 2024 Financial Results
25 September 2024
Global Investment Holdings (“GIH”), a diversified conglomerate operating in 19 different countries across 4 continents, announced its half year consolidated results which ended 30 June 2024, and commented on recent developments.
Global Investment Holdings reported Consolidated Net Profit of 692mn TL in 6M 2024, compared to a net profit of 321mn TL in 6M 2023. Consolidated Net Revenues (excluding IFRIC 12 Construction Revenue) is 7.4bn TL; while Consolidated Operating EBITDA is 2.9bn TL.
Global Investment Holdings’ Chairman & CEO, Mehmet Kutman, stated:
“Under the challenging macroeconomic environment, we have navigated through a difficult second quarter. We are currently experiencing a transitional period marked by economic slowdown and the misalignment between inflation and exchange rates. As Global Investment Holdings, we have announced our consolidated financial results for the second quarter of 2024. Despite persistent high inflation, rising operational costs, and challenging price/demand dynamics, Global Investment Holdings maintained its resilience and concluded the quarter with a steady performance.”
I am pleased to share with you one of the most significant recent developments. “As of August 9, 2024, GPH has been delisted from the London Stock Exchange and is now a private company. As part of this process and following the tender offer for our indirect subsidiary, Global Ports Holding Plc (GPH), our Group purchased a total of 23,835,233 GPH shares at a price of 4.02 USD per share. Additionally, it was decided to convert our Company’s 23.9 mn USD receivables from GPH into shares through a capital increase (5,945,273 new shares). Following these transactions, our Group’s ownership in GPH’s issued share capital has now increased to 90.16%”
GIH believes that while GPH’s listing helped to raise the profile of GPH initially, for the past several years due to the continuing low trading liquidity in the shares, GIH believes that GPH’s listing significantly hinders GPH, and GPH would be best positioned to continue its next phase of growth as a private company. GIH believes that as an infrastructure group, GPH should be able to freely execute growth strategies and have access to flexible long-term financing to remain competitive. Private ownership would therefore enable GPH to better execute its strategy of continuing to expand and develop its cruise port portfolio globally, without the distraction, challenges and costs of the requirements of being a publicly listed company.
The Chairman emphasized that: “We have added two more ports to our portfolio in 6M 2024, namely, San Juan Cruise Port in Puerto Rico (30-year concession agreement) and Liverpool Cruise Port in UK (50-year agreement). Moreover, GPH has commenced operations at the Saint Lucia Cruise Port as of May 2024.
The Chairman continued: In addition, following a public tender process, a majority-owned consortium (the “Consortium”) between GPH (51%), local shareholder, Steya (40%) and Ocean Infrastructures Management (9%) has been awarded preferred bidder status for a 15-year concession agreement with Agence Nationale des Ports (“ANP”), to operate the Casablanca new cruise terminal.
The Chairman continued: “In order to further strengthen their balance sheets and enhance their financial capacity, our Gas and Power divisions successfully completed their capital increase processes, standing out strong to drive growth. After Naturelgaz’s bonus issue, the company’s issued capital has been increased by 200%, to 690mn TL, which was fully funded through internal resources. On the other hand, Power generation portfolio of the Group completed a 100% rights issue in August 2024, raising its issued capital to 771mn TL. The funds raised were used to repay financial debt.
In addition to these, Consus Enerji’s offer were accepted for a tender announced by the Ministry of Energy and Transport of the Commonwealth of the Bahamas and the Bahamas Power and Light Company for the electricity needs of two islands, including 65 MW natural gas and solar power plants, and 20 MW storage systems, with a total capacity of 85 MW, and for the sale of electricity at a unit price based on US Dollars for a period of 25 years. The investment process for the project is anticipated to be completed by 2026, with the power plants being commissioned and becoming fully operational. To participate in the tendered project with a 49% partnership, Consus Bahamas Energy Ltd., a wholly owned subsidiary of Consus Enerji, has been successfully incorporated in the Commonwealth of the Bahamas.
İstanbul Asset Management has also had a good second quarter in 2024. Assets under management have increased substantially to over 108bn TL as of August 2024. “
Commenting on the results, the Chief Financial Officer of Global Investment Holdings, Ferdağ Ildır, stated:
“Despite the challenging macroeconomic conditions we are facing, I am pleased to highlight the balanced and stable performance our group has demonstrated in financial indicators in 6M 2024. Additionally, I am happy to share that we have submitted our application for a bonus capital increase, which will be fully funded through internal resources. During our general assembly meeting held on August 15, we also reaffirmed our commitment to our shareholders by deciding to distribute dividends by the end of this year.”
Global Investment Holdings reported 7.4bn TL revenues (excluding IFRIC-12 Construction Revenue) in 6M 2024, indicating a 8% increase yoy on an inflation adjusted basis.
Global Investment Holdings’ consolidated operating EBITDA is 2.9bn TL in 6M 2024 indicating a 25% increase yoy on an inflation adjusted basis.
GIH reported a consolidated net profit of 692.5mn TL in 6M 2024 with a strong 116% increase on an inflation adjusted basis. The bottom line incorporated non-cash expenses of depreciation & amortization amounting to TL 1,1bn and net foreign exchange loss amounting to TL 138.5mn. In addition, due to the application of IAS 29, there was a monetary gain amounting to TL 336.0 mn in 6M 2024.
On a divisional basis:
On the ports side,
Number of calls at GPH`s consolidated ports in Jan-Aug 2024 was 22% higher than Jan-Aug 2023 levels, while number of passengers visiting GPH`s consolidated ports in Jan-Aug 2024 was 29% higher than 2023 levels.
Average occupancy rates of the cruise ships visiting GPH`s consolidated ports in July 2024 was 115%.
Revenues surged by 37% in 6M 2024 compared to 6M 2023, reaching 3.3bn TL, while adjusted EBITDA jumped by 33% compared to 6M 2023 reaching 2.1bn TL in 6M 2024.
Naturelgaz, Sales volume reached 156mn Sm3 in 6M 2024, representing an increase of 21% yoy. The increase in sales volume was mainly driven by Citygas sales. Citygas sales volume increased by 35% yoy, reaching 94mn Sm3 . The number of districts and towns reached 124 by 6M 2024.
Due to inflation accounting and decline in natural gas prices, revenues decreased by 14% yoy , standing at 2.3bn TL in 6M 2024 yoy, despite volume growth.
Operating profit increased yoy in 6M 2024, thanks to recent investments for cost efficiency as well as volume growth. EBITDA increased by 7% yoy, reached at 469mn TL.
Due to an increase in volume and contributions from cost management, gross profit increased 8% yoy in 6M 2024 reached 575mn TL.
Profit before tax, which was 71mn TL in 6M 2023, nearly doubled, reaching 135mn TL in 6M 2024, based on company standalone financials.
The power division, reported 617.2mn TL revenues in 6M 2024, indicating a 13% decrease yoy. The lower Market Clearing Price (PTF) compared to the same period of the previous year and the implementation of inflation accounting practices were influential in the mentioned decrease in consolidated revenues.
EBITDA increased by a 4% to 170.7mn TL in 6M 2024 yoy.
Net profit increased by a 72% to 21.7mn TL in 6M 2024 yoy. In addition to the increase in operational profitability, monetary gains from the implementation of inflation accounting and deferred tax income were factors that positively affected the period’s net profit, while the increase in financing expenses due to rising borrowing costs negatively impacted the net profit for the period.
The mining division, because of the decline in demand from the local and European markets, achieved a sales volume of 118,291 tons in 6M 2024, representing a 40% decrease yoy.
The Company’s main export markets continued to be Spain, Italy and Egypt. Export related sales volume was 88,931 tons while domestic sales volume was realized at 29,360 tons for the period.
The mining division announced revenues of 241.5mn TL in 6M 2024 with 21% decrease.
The operating EBITDA was 61.8mn TL in 6M 2024, indicating a 2% decline yoy. The decline in EBITDA was mainly attributable to lower sales volume as well as contracting operating margins as a result of higher inflation rates compared to fx rate hikes. The increasing focus on high value-add products provided a positive impact on EBITDA performance, largely compensating the decline in sales volume.
The real estate division registered 6% increase in revenues and 8% increase in EBITDA in 6M 2024 yoy, with revenues and EBITDA standing at 96mn TL and 44mn TL, respectively. Operational improvement is mainly attributable to the increasing contribution from higher EBITDA generating rental operations.
The brokerage & asset management division revenues stood at 719mn TL 6M 2024, registering a 27% increase yoy, thanks to the contribution from increasing transaction volumes, while operating EBITDA was 192mn TL registering a 12% increase yoy.
Indebtedness:
Holding consolidated net debt stood at 844mn USD (27.7bn TL) at 6M 2024. Meanwhile, excluding GIH standalone, consolidated gross debt of our operational divisions stood at 1.0bn USD. (Ports division: 915mn USD).
For further information, please contact:
GIH Investor Relations
Tel: +90 212 244 60 00
E-mail: investor@global.com.tr
