14 Nov 2023
CIEL Group


Key highlights


• Revenue amounted to MUR 8.8 bn (USD 194M), representing a 2% decrease, principally attributable to a 15% drop in revenue from the Textile cluster, mitigated by strong performances from the Hotels & Resorts, Finance and Healthcare clusters

• EBITDA increased by 16%, reaching MUR 1.5 bn (USD 34M), supported by robust performances from the Hotels & Resorts, Finance and Healthcare clusters

• Profit after Tax increased by 37% and Profit Attributable to owners grew by 21%, reflecting a rebalancing of the earnings mix from the previous year, with a notable share of profit coming from the Hotels & Resorts, Finance and Agro clusters

• Free Cash Flow increased more than 4x to reach MUR 1.2 bn (USD 28M), due to positive cash flows from operating activities across the Hotels & Resorts, Textile and Finance clusters

• Net interest-bearing debt reduced by MUR 135M (USD 3M) in the first quarter, standing at MUR 11.9 bn (USD 268M), leading to a gearing ratio of 27.8%


Hotels and Resorts

In a seasonally low quarter, the Hotels & Resorts cluster posted a 17% revenue increase reaching MUR 1.8 bn compared to the same quarter in 2022. EBITDA increased to MUR 399M from MUR 308M due to a much-improved Average Daily Rate (ADR) in a context of challenging inflationary pressures and labour shortages. The cluster’s proactive debt reduction strategy led to a 30% reduction in net finance costs for the period. This positively impacted Profit after Tax which reached MUR 145M, a significant improvement from MUR 14M reported in the same period of 2022.



Textile revenue in the first quarter stood at MUR 4.4 bn, reflecting a 15% decline, primarily attributed to a slow down in demand resulting in pressure on margins. The cluster’s Indian shirt operations continued to perform well and partially mitigated the revenue reduction seen in other segments, notably in Knits. EBITDA decreased from MUR 463M to MUR 370M during this period largely influenced by industry-wide challenges, pressure on selling prices in an inflationary environment and aggravated by higher energy costs. Finance costs for the cluster rose by 56% mainly due to higher interest rates, resulting in a 44% reduction in Profit after Tax to MUR 150M. Our strategic partnership with SOCOTA in Madagascar achieved a break-even performance during this quarter.



CIEL Finance achieved an 11% revenue growth, reaching MUR 1.4 bn, driven by improved interest margins resulting in higher Net Interest Income at BNI Madagascar (BNI). This was supported by a reduction in interest expenses, coupled with growth in Non-Interest Revenue which included forex income and fees and commissions. EBITDA improved by 53%, reaching MUR 554M compared to the same quarter last year, primarily attributable to reduced write-offs and lower funding costs (interest expenses) at BNI during this quarter. Profit after Tax increased by 72% to MUR 402M inclusive of an improved share of profit from Bank One of MUR 85M, compared to MUR 52M in the corresponding quarter last year.



With revenue up 20% on the prior year’s first quarter to MUR 1.1 bn, growth in the Healthcare cluster was driven by higher occupancy levels and an increase in core activities, especially in Uganda. EBITDA increased by 16% to MUR 230M. During the quarter, a new clinic in Mont Choisy commenced its operations. The cluster recorded increased depreciation and finance costs due to significant capital expenditure on new facilities and upgrades of existing ones, this led to a 4% decrease in Profit after Tax which stood at MUR 89M.



The cluster’s revenue increased by 15% to MUR 60M. This growth was mainly driven by higher rental income at Evolis Properties. During this quarter, Phase 2 of the mixed-use property development, Nouvelle Usine, was launched and will be completed in the third quarter of this financial year. Additionally, on 28 September 2023, the Group secured a MUR 435M sustainable loan for Ferney Development Ltd. This decision aligns with La Vallée de Ferney’s commitment to sustainable development within its Tropical Agrihood project and entails meeting enhanced environmental and social reporting obligations.



CIEL reported a 70% increase in the combined share of profit attributable from Alteo Limited and MIWA Sugar Limited, totalling MUR 221M. MIWA Sugar had a good quarter driven by improved margins resulting from increased sales in Tanzania, coupled with a strong performance in its Kenyan operations due to heightened production, increased sales and favourable pricing conditions in the country. The revenue performance in the property segment at Alteo Limited was less favourable compared to the previous year, primarily due to the cyclical nature of residential project deliveries. On the agricultural front at Alteo, the company benefitted from higher sugar prices, helping to offset the negative impact of a delayed start to the harvest for the 2022 crop. Alteo’s earnings benefitted from the positive movement in the fair value of biological assets and lower overhead, production and finance costs.



The 8.5% portfolio growth was driven by the higher share price from our listed entities, Alteo Limited (up 31%) and Sun Limited (up 29%) on the main market of the Stock Exchange of Mauritius. Furthermore, the share price of MIWA Sugar and C-Care Mauritius’ Volume Weighted Average Price also increased by 25% and 17% respectively, both of which are listed on the Development and Enterprise Market of Mauritius. CIEL’s overall portfolio valuation increased by MUR 1.8 bn to reach MUR 23.1 bn as at 30 September 2023.

The Company Net Asset Value rose by 9% to MUR 12.05 per share at 30 September 2023 versus MUR 11.03 at 30 June 2023. Over the quarter, CIEL’s share price increased by 9% to MUR 7.10 from MUR 6.52 at year end 30 June 2023. The subsequent market capitalisation stood at MUR 12.0 bn.



CIEL is strategically well positioned to navigate the evolving macroeconomic landscape with agility. Assuming market trends and operating environment remain stable, we anticipate an increase in net earnings for the first semester of the current financial year.