OCI NV says earnings hit by gas supply constraints

Reuters Middle East

(Adds detail, background, writes through)

By Maggie Fick

CAIRO, May 17 (Reuters) - Egyptian construction and

fertiliser group OCI said its core earnings were flat

in the first quarter, citing lower construction margins and

reduced output at its Egyptian plants due to interruptions in

supplies of natural gas.

The Dutch-listed parent of Orascom Construction Industries

(OCI) said output from its Egyptian plants was reduced

by the gas supply reductions, which it linked to a tax dispute

between its subsidiary OCI and the Egyptian authorities.

It gave no figure for core profit or EBITDA (earnings before

interest, taxes, depreciation and amortisation).

The group, one of Egypt's biggest companies, also said on

Friday it estimated first-quarter consolidated earnings had

increased by between 10 and 20 percent from last year, but again

gave no figures.

It said its Egyptian plants "faced natural gas supply

curtailments" during the first quarter, but that since a

settlement agreement on April 30, gas utilisation rates had

increased.

OCI, run by one of Egypt's most prominent Christian

families, the Sawiris, said last month the Egyptian tax

authority had exonerated it of wrongdoing after it agreed to pay

7.1 billion Egyptian pounds ($1 billion) to resolve a tax

dispute.

The dispute stemmed from the company's plan to delist from

the Egyptian bourse, a move which was resisted by the country's

Islamist-led government.

OCI NV, which already owns about 70 percent of the

Egypt-listed shares, had on Tuesday cut the price of its tender

offer for the delisting without giving a reason for the

reduction, though analysts said it was not a surprise after a

fall in the price of the Cairo-listed stock.

($1 = 6.9760 Egyptian pounds)

(Editing by David Holmes)

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