Despite the challenging global macroeconomic environment, 2022 was an incredibly successful year for EFG Hermes’ sell-side business.

Sell-side overview

Despite the challenging global macroeconomic environment, 2022 was an incredibly successful year for EFG Hermes’ sell-side business. Despite rising inflationary pressures and interest rates, currency devaluations, and political instability, I am happy to say that each division under the sell-side umbrella came out strong, rising above the hurdles and delivering exceptional operational and financial results.

Our premier Brokerage franchise witnessed a record-breaking year, substantially capitalizing on the volatility in the MENA region’s markets to increase traded volumes and market shares, particularly in the GCC region. By year-end 2022, the division successfully sustained its rankings across most of its focus markets, ranking first on the EGX and the DFM and second in Abu Dhabi and Kuwait. Leveraging the region's highly volatile trading environment, we successfully attracted a more extensive client base across our online trading platform, EFG Hermes One, and unlocked a larger number of MENA-focused prospects for our investors. In the frontier markets in which we operate, our Brokerage division delivered a commendable performance despite the region's lingering macroeconomic and political challenges. The division was the highest ranked in Kenya for the third consecutive year and continued to strengthen its position in Pakistan and Nigeria.

Another landmark milestone we take pride in is the first in-person iteration of our flagship One on One Conference following the onset of the COVID-19 pandemic, which took place in September 2022. The conference facilitated thousands of meetings, bringing together hundreds of regional and global investors seeking the region's most value-accretive investment opportunities. We were incredibly proud of the success of this iteration.

On the investment banking side, our flagship Investment Banking division performed remarkably during 2022, leveraging its unrivaled execution capabilities to advise on the most prominent ECM, DCM, and M&A deals across the region. The highlight for 2022 — and something we are incredibly proud of — was our ability to capitalize on the significant boom in ECM activity in the GCC, which has rapidly grown to become an investment haven for regional and global investors alike. Our Investment Banking division has undoubtedly played a pivotal role in making these offerings happen and bringing a wider range of high-value investment prospects to market. The division facilitated a total of 12 ECM transactions in 2022, 10 of which were IPOs, including the USD 6.1 billion listing of Dubai utility player DEWA, the USD 724 million initial public offering of Empower on the Dubai Financial Market (DFM), and the USD 1.0 billion listing of Dubai’s exclusive toll-gate operator Salik on the DFM. Another landmark transaction the division advised on was the USD 1.8 billion dual-listing of restaurant-chain operator Americana on the ADX and the Saudi Exchange — a never-before-seen listing between both exchanges — and the USD 378 million IPO of Riyadh Cables Group (RCGC) — the largest cable manufacturer in the region — during the year. The division also advised on education provider Taaleem’s USD 204 million IPO on the DFM, the USD 2.0 billion listing of Borouge on the Abu Dhabi Exchange (ADX), and Ali Alghanim and Sons Automotive Company’s USD 323 million private placement ahead of its IPO on Boursa Kuwait — the first international IPO on the Kuwaiti exchange since 2020. In Oman, the division advised on the USD 60.6 million IPO of Pearl REIF — Oman’s largest Shariah-compliant real estate investment fund — on the Muscat Stock Exchange (MSX).

On the M&A front, EFG Hermes Investment Banking acted as sell-side advisor on the acquisition of a 70% stake in two Egypt-based maritime and terminal operating companies, Transmar International Shipping Company (Transmar) and Transcargo International (TCI), by Abu Dhabi Ports Group (AD Ports). The transaction, valued at USD 140 million, marked AD Ports’ first investment in Egypt. The team also acted as buy-side advisor to the Public Investment Fund of Saudi Arabia (PIF) on its indirect acquisition of a significant minority stake in B.Tech, Egypt’s leading consumer electronics retailer. Other landmark deals for the year included the sell-side advisory on the USD 115.7 million majority acquisition of Auf Group, a leading healthy snacks and coffee manufacturer as well as retailer in Egypt, by UAE-based Agthia, a leading food and beverage company in the region.

Alongside the success of our Brokerage and Investment Banking divisions, our Research division was once again recognized as the chief regional provider of fundamental- based research, facilitating well-rounded products, tools, and insights for our teams and clientele across the board. During the year, the division expanded coverage to 348 stocks, focusing on expanding its presence in Southeast Asia as part and parcel of our strategy to broaden our research coverage regionally. Additionally, the division supported the Firm’s Investment Banking division in advising on the region’s largest IPOs — all of which were closed with the help of the Research division’s unrivaled insights.

Despite the world witnessing consequential incidents, our goals for next year stay the same — to continue building on the tremendous success we have worked so tenaciously to achieve over the last four decades. On the investment banking front, we will continue to capitalize on the ever-growing demand in the markets where we operate by offering the most compelling ECM, DCM, and M&A propositions. The GCC has proven to be a market to watch, and the significant ramp-up in ECM activity over the last year is something we aim to propel going forward. In our home market of Egypt, we continue to see growing demand for DCM products. We aim to capitalize on this by bringing to market alternative financing solutions that enable our clients to deliver on their expansion plans. Our efforts in Egypt in 2022 also paid off on the M&A front. Having closed several cross-border deals, we plan to continue building on this by connecting global capital to local opportunities that position Egypt as a value-accretive investment destination.

On the brokerage front, and in efforts to ramp up the business from a fintech perspective, we are looking to bring our online, award-winning, and cutting-edge trading platform, EFG Hermes One, to more GCC markets, expanding our online presence and facilitating online trading in the region. On the research front, the division seeks to branch out from its current coverage portfolio and continue focusing on more attractive Southeast Asian markets, such as Indonesia, Thailand, and the Philippines. It also aims to broaden its product offerings to ensure more diversified insights for EFG Hermes Holding and its clients.

As we dive into 2023, we remain confident in our ability to continue building on our track record of remarkable achievements over the years. We are excited to see what the year holds for us in the sell-side business as we remain committed to our clients, partners, and the markets in which we operate. This commitment we so fiercely honor enables us to continue delivering exceptional performance across all metrics, year on year.

Mohamed Ebeid

Co-CEO for the Investment Bank,

Securities Brokerage

Overview

EFG Hermes' Securities Brokerage division is the MENA region’s leading brokerage house offering a wide range of innovative and tailored products and services, secure multi- platform trading tools, market intelligence and insights, and unparalleled executional capabilities, ensuring maximum generated returns tailored to different investor preferences and risk profiles. The division boasts an expansive four- continent presence across the MENA region and FEM and operates in countries that include Egypt, Kuwait, the UAE, Saudi Arabia, Oman, Jordan, Pakistan, Kenya, Nigeria, and Bangladesh, with regional offices in the US and the UK.

Operational Highlights of 2022

The Brokerage division ended the year on a strong note, having delivered a solid performance across its operational footprint by focusing on bolstering its performance across its core markets of operations. As a result, the division witnessed an expansion in traded volumes across most regions during the year and a substantial growth in its market shares across the board.

By the end of the year, the division had registered an increase of 33% Y-o-Y rise in revenues to stand at EGP 1.8 billion, primarily driven by the increase in executions in the MENA region, including Saudi Arabia, the UAE, Qatar, and Kuwait. In terms of pure commissions registered in regional markets, Egypt and the UAE markets, including Dubai and Abu Dhabi, came in at first place with a contribution of 19% each, followed by Saudi Arabia and Kuwait, with each registering a contribution of 16%. As a result of its revenue growth, the division’s regional market shares climbed during the year.

In its home market of Egypt, the Brokerage division successfully sustained its first-place ranking on the EGX, closing the year with a market share of 40.2%, up from a market share of 33.8% booked in 2021. This was mainly driven by the currency devaluation of the Egyptian pound that occurred this year, which sparked a significant increase in traded volumes. Foreign participation came in at 25.8% during the year, with EFG Hermes successfully capturing over 78% of these institutional inflows.

In 2022, Kuwait was one of the GCC countries that witnessed a significant ramp up in traded volumes, primarily driven by the oil price surges witnessed during the year, and the healthy investor sentiment in the Kuwaiti financial market. Additionally, the year saw homegrown Kuwaiti automotive brand, Ali Alghanim and Sons, issue an IPO on Boursa Kuwait, which broke ground as the first IPO on the exchange since 2020, spurring demand for more local businesses to go public in the market. Capitalizing on this pent-up demand, the Brokerage division maintained its second-place ranking in 2022, with a market share of 32.8% — a 3.2% increase Y-o-Y from the 29.6% recorded in 2021 — and over 60% of foreign institutional inflows captured.

In the UAE, the Brokerage division managed to grow its market share on the back of the hike in GCC and local trading on the retail and institutional fronts and the substantial ramp up in IPOs witnessed during the year. In Dubai, the division sustained its first-place ranking on the DFM, with a market share of 41.1% at year-end 2022, up 5.2% from the 35.8% registered in 2021. On the ADX, EFG Hermes’ market share stood at a solid 14.7% by the end of the year, maintaining its second-place ranking on the exchange.

In Saudi Arabia, despite the drop in market volumes, the Brokerage division managed to grow its market share in the kingdom, recording a twofold increase from 2% in 2021 to 4.4% in 2022. This was mainly fueled by the increase in foreign institutional activity during the year.

Activity in Oman and Jordan remained relatively flat for the year and saw the division sustain its market share in both markets, standing at 17.3% in Oman and 6.3% in Jordan.

The Firm’s Direct Market Access (DMA) trading platform made progress throughout the year, automatically linking foreign institutional investors to the system’s database as part of the Firm’s efforts to contribute to promoting digital transformation, and enabling them to directly submit their orders into the market. With this significant development in the digital brokerage space, EFG Hermes continues to introduce innovative financial solutions to its investors and expand its product and service offerings.

Frontier Markets

2022 was a relatively challenging year for frontier markets, primarily driven by the unstable macroeconomic environment witnessed during the year. In Pakistan, the market witnessed another tough year on the back of macroeconomic and political volatility, which resulted in lower volumes and a decline in market activity for the year. As such, investors were bearish on the market, and EFG Hermes’ market share stood at 3.66% by the end of the year.

In Kenya, despite the rising pressures on the back of currency devaluations, foreign inflows were the main driver that stabilized the market for another year, and the division managed to cement its first-place position with a 70.01% market share.

Meanwhile in Nigeria, EFG Hermes leveraged the strides made in the previous years, standing as the fifth leading broker in the country with a 9.91% market share.

Online Trading

In 2022, the Firm’s world-class online trading, EFG Hermes One, garnered significant traction, particularly following the revamp of the application in 2021 in efforts to enable investors to tap into a wealth of investment knowledge, execute informed trades, and monitor their portfolios in real time through a simpler, user-friendly interface and new exclusive features. GCC markets in particular came out strong on the digital platform, driven by the hikes in oil prices during the year. Nonetheless, the strong volatility surrounding the US market, primarily driven by the hikes in interest rates, resulted in a slight drop in revenues generated through the application on global trading.

Structured Products

The Structured Product Desk was launched in 2016 as an integral part of the Firm’s strategy to grow its capital market business and deliver a suite of diverse products to the franchise. In 2022, EFG Hermes Securities Brokerage’s Structured Product Desk’s revenues declined by 25% to record EGP 60 million versus the EGP 79 million booked at year-end 2021.

Unique Corporate Access

To unlock lucrative investment prospects for global and regional investors across key sectors in the world’s most promising markets, EFG Hermes held its 16th One on One Conference in September 2022, marking its first in-person iteration since the onset of COVID-19. The conference witnessed the participation of 205 companies from 33 countries in direct meetings with over 655 institutional investors and fund managers representing 270 international institutions. The 17th iteration of the conference is slated to take place in March 2023 and is anticipated to have an even wider turnout.

Key Financial Highlights 2022

The Brokerage division’s revenues grew 33% Y-o-Y to EGP 1.8 billion in 2022, on the back of the favorable market conditions resulting in higher volumes across multiple of the Firm’s core markets of operation.

Awards

Forward-Looking Strategy

Going forward, the Brokerage division aims to capitalize on the rapid recovery witnessed across its core markets, and to continue building on the exceptional performance it has delivered in 2022. In its home market, the division aims to continue to leverage its substantial portfolio of institutional investors, with an eye to further increase its market share. In the GCC region, the significant boom in the region’s equity markets following the increase in oil prices and prominent IPOs will continue to unlock numerous opportunities for regional and global investors and generate healthy trade volumes across the board. Leveraging its leading market positions on the GCC’s exchanges, the division is perfectly positioned to capture an even larger share of the market and generate higher foreign institutional flows. In global markets, the strong uncertainty surrounding the interest and inflation rate environment continues to pose investment challenges and

concerns, which are expected to linger in 2023. On the frontier and emerging side, the Brokerage division continues to focus on strengthening its performance in its core markets; Egypt, United Arab Emirates, Saudi Arabia, Kuwait, Kenya, and Nigeria. To bolster its online platform’s presence beyond Egypt and Kenya, the division aims to introduce its flagship EFG Hermes One platform to new markets, including Kuwait, the UAE as well as others.

Investment Banking

Overview

EFG Hermes' Investment Banking division has grown over the years to become the region’s most trusted advisory house and has successfully cemented its leading position as the regional Investment Banking franchise of choice for partners and clients in the MENA region and FEM. Leveraging decades of industry and market acumen, the division continues to advise on the region’s largest, most prominent transactions in the Mergers and Acquisitions (M&A), Equity Capital Markets (ECM), and Debt Capital Markets (DCM) spaces by leveraging the multidisciplinary experience of over 40 professionals. It provides its clients with key economic, industry, market, and company-focused insights, steering the region with its solid on-the-ground presence and expansive track record. By the end of 2022, the division recorded a total of 32 ECM, DCM, and M&A transactions across its footprint, with an aggregate value of over USD14.3 billion.

Operational Highlights of 2022

In light of the Russia-Ukraine conflict, rising inflationary pressures, currency devaluations, and a high interest-rate environment, 2022 was a challenging year for global markets. Nonetheless, the GCC region came out strong, driven by a solid crude oil market and government initiatives that bolstered capital markets and investor sentiment. In 2022, ECM activity in the GCC boomed, with the UAE, Saudi Arabia, Kuwait, and Oman collectively seeing a record-high number of mega-hit IPOs.

EFG Hermes’ Investment Banking division concluded the year having captured a large share of the most significant transactions in the GCC region. The division closed 13 DCM transactions valued at USD 453 million, 12 ECM transactions valued at USD 12.8 billion, and seven M&A transactions worth USD 1.1 billion. As a result of its strong performance in the equity capital market space, the division placed second on the Refinitiv ECM 2022 League Table.

ECM

In Dubai, the division advised on leading education provider Taaleem’s USD 204 million IPO on the DFM, marking the first private-sector IPO on the DFM since 2014. The transaction also saw EFG Hermes' Investment Banking transition from its typical joint bookrunner role to acting as a joint global coordinator on the listing. The division also concluded advisory on state-owned Dubai Electricity and Water Authority’s (DEWA) USD 6.1 billion IPO on the DFM — the largest ever listing in the Middle East since Saudi Aramco’s IPO in 2019 and the first for a public company in Dubai. The division also advised on the USD 1.0 billion IPO of Dubai toll operator Salik and acted as joint bookrunner on the USD 724 million IPO of Emirates Central Cooling Systems Corporation (Empower). In Abu Dhabi, the division successfully completed advisory on the USD 2.0 billion IPO for leading global petrochemicals manufacturer Borouge plc — a joint venture between Abu Dhabi National Oil Company (ADNOC) and Borealis AG — on the ADX, marking the largest listing in the history of the exchange.

Breaking ground in Kuwait, EFG Hermes completed advisory on the USD 323 million private placement for Ali Alghanim and Sons Automotive Company ahead of its IPO on Boursa Kuwait, for which the division acted as joint bookrunner. Marking the first IPO in the Kuwaiti stock market since 2020 and the largest in the country, the transaction sparked a substantial surge in future IPO activity in Kuwait.

2022 also saw the division act as joint bookrunner on the landmark USD 1.8 billion IPO of Americana Restaurants International Plc (Americana) on the Saudi Stock Exchange and the ADX, marking the first-of-its-kind concurrent dual listing between the two exchanges. Also on the Saudi Exchange, the division advised on the USD 378 million IPO for Riyadh Cables Group (RCGC) — the largest cable manufacturer in the region — during the year.

In Oman, the division advised on the USD 60.6 million IPO of Pearl REIF — Oman’s largest Shariah-compliant real estate investment fund — on the Muscat Stock Exchange (MSX).

In its home market, EFG Hermes acted as sole global coordinator and joint bookrunner on the USD 81.7 million IPO of Macro Group, one of the most prominent cosmeceutical players in the Egyptian market, on the Egyptian Exchange (EGX).

2022 ECM Deals

Macro Group IPO – Joint bookrunner and sole global coordinator on the USD 81.7 million initial public offering on the EGX.

DEWA IPO – Joint bookrunner on the USD 6.1 billion initial public offering on the DFM.

Salik IPO – Joint bookrunner on the USD 1.0 billion initial public offering on the DFM.

Taaleem IPO – Joint global coordinator on the USD 204 million initial public offering on the DFM.

Empower IPO – Joint bookrunner on the USD 724 million initial public offering on the DFM.

Borouge plc IPO – Joint bookrunner on the USD 2.0 billion initial public offering on the ADX.

Riyadh Cables IPO – Joint bookrunner on the USD 378 million initial public offering on the Saudi Exchange.

Americana Dual Listing – Joint bookrunner and underwriter on the USD 1.8 billion dual listing on the ADX and Saudi Exchange.

Ali Alghanim and Sons Automotive Company IPO – Joint bookrunner on the USD 323 million initial public offering on Boursa Kuwait.

Pearl REIF IPO – Joint bookrunner on the USD 60.6 million initial public offering on the MSX.

Fawry Rights Issue – Sole financial advisor on the USD 43.2 million rights issue on the EGX.

M&A

On the M&A front, the Firm’s Investment Banking team delivered a solid performance during 2022, bridging the gap between its home market of Egypt and the GCC. The division acted as sell-side advisor on the USD 500 million majority stake sale of Al Meswak Dental Clinics, the largest dental and dermatology service provider in Saudi Arabia.

In Egypt, EFG Hermes’ Investment Banking division acted as a sell-side advisor on the acquisition of a 70% stake in two Egypt-based maritime and terminal operating companies, Transmar International Shipping Company (Transmar) and Transcargo International (TCI), by Abu Dhabi Ports Group (AD Ports). The transaction, valued at USD 140 million, marked AD Ports’ first investment in Egypt.

The team also acted as a buy-side advisor to the Public In- vestment Fund of Saudi Arabia (PIF) on its indirect acquisition of a significant minority stake in B.Tech, Egypt’s leading consumer electronics retailer.

Other landmark deals for the year included the sell-side advisory on the USD 115.7 million majority acquisition of Auf Group, a leading healthy snacks and coffee manufacturer as well as retailer in Egypt, by UAE-based Agthia, a leading food and beverage company in the region.

2022 M&A Deals

Transmar International Shipping Company and Transcargo International (TCI) Sale – Sell-side financial advisor to Transmar and TCI’s shareholders on the 70% stake sale of both companies to AD Ports in a transaction worth USD 140 million.

Auf Group Sale – Sell-side financial advisor to Auf Group on the majority stake sale to UAE-based Agthia worth USD 115.7 million.

Credit Agricole S.A. Accelerated Direct Purchase – Buy- side advisor to Credit Agricole S.A. on its direct purchase of a 4.8% stake in Credit Agricole Egypt in a transaction worth USD 21.1 million.

B.Tech Acquisition – Buy-side advisor to the PIF on its indirect acquisition of a significant minority stake in B.Tech.

Al Meswak Dental Clinics Sale – Sell-side advisor on the USD 500.0 million majority stake sale of Al Meswak Dental Clinics to Jadwa.

DCM

In the DCM space, the Firm’s Investment Banking division recorded a solid performance during the year. It continued to provide alternative financing solutions to the market while supporting its clients in delivering on their expansion plans. Milestone DCM transactions for the year included the team’s advisory on several securitization deals for the Firm’s subsidiaries, including EFG Hermes Corp-Solutions’ second issuance in its securitization program, in a transaction worth USD 102.3 million, marking the team’s largest debt transaction in 2022. Another synergistic transaction was that of Bedaya Mortgage Finance, which saw the division advise on the mortgage finance player’s first securitization issuance worth USD 35.2 million.

To further solidify its position as the partner of choice in the ever-growing Egyptian real estate industry, the team ad- vised chief real estate player Orascom Development Egypt on the USD 81.1 million financing package for its flagship O-West project.

Parallel to this, the team advised MARAKEZ, a leading Saudi real estate player in Egypt, on its USD 39.2 mil- lion debt arrangement alongside EFG Hermes Corp-Solutions and the Firm’s recently acquired aiBANK, who acted as leasing partner and lender, respectively — a testament to the division’s unrivaled ability to provide end-to-end financial solutions to its clients by capitalizing on the synergies between the Firm’s wide-ranging lines of business.

As part and parcel of its strategy to bring a broader range of offerings to market, the Investment Banking division concluded advisory on CIRA Education’s USD 32.7 million future flow securitization bond offering — Egypt’s first ever future flow securitization issuance.

2022 DCM Deals

Pioneers Properties Securitization Program – Financial advisor, lead arranger, underwriter, and bookrunner on Pioneers Properties’ second and third securitization bond issuance worth USD 23.0 million and USD 11.9 million, respectively.

EFG Hermes Corp-Solutions Securitization Program – Advised EFG Hermes Corp-Solutions on its second securitization issuance in a transaction worth USD 102.3 billion.

EFG Hermes Corp-Solutions Bond Offering – Advised on the USD 27.0 million bond issuance for EFG Hermes Corp- Solutions.

By the end of 2022, EFG Hermes' Investment Banking division recorded a total of 32 ECM, DCM, and M&A transactions across its footprint, with an aggregate value of over USD 14.3 billion.

valU Securitization Program – Advised valU on the second issuance of its securitization program in a transaction worth USD 27.5 million.

MARAKEZ Debt Arrangement – Advised MARAKEZ on its USD 39.2 million debt arrangement.

Orascom Development Financing Package – Advised leading real estate player Orascom Development Egypt on the USD 81.1 million financing package for its flagship O-West project.

Bedaya Securitization Program – Sole financial advisor on the USD 35.2 million securitization issuance for Bedaya Mortgage Finance, the first securitization issuance for a real estate mortgage company in Egypt.

Orascom Development Financing Package – Advised leading real estate player Orascom Development Egypt on the USD 81.1 million financing package for its flagship O-West project.

Madinet Nasr for Housing and Development (MNHD) Securitization Program – Sole financial advisor on the USD 19.1 million securitization issuance for MNHD. Premium International for Credit Services (Premium) Securitization Program – Advised Premium on the sixth and seventh issuances of its short-term securitization program, worth USD 10.8 million and USD 8.1 million, respectively.

CIRA Future Flow Securitization Program – Advised CIRA on a USD 32.7 million future flow securitization issuance, the first future flow securitization issuance in the Egyptian DCM space.

valU Securitization Program – Advised valU on the third issuance of its securitization program in a transaction worth USD 34.7 million.

Key Financial Highlights of 2022

EFG Hermes’ Investment Banking division reported total revenues of EGP 748 million at year-end 2022, reflecting a 51% increase from the EGP 494 million booked in 2021. Investment banking revenues contributed approximately 7% of EFG Hermes Holding’s total revenue in 2022.

Forward-Looking Strategy

While 2023 is expected to present challenging conditions for global markets, EFG Hermes' Investment Banking division remains confident in its ability to continue expanding its range of offerings and providing more compelling, value-accretive investment prospects across the markets in which it operates. The GCC region remains a global investment hub, particularly on the equity front. In alignment with this, EFG Hermes' Investment Banking division aims to continue leveraging its unparalleled execution and research capabilities to lead and advise and research capabilities to lead and advise on the region’s largest, most notable transactions in efforts to sustain its position as the leading investment banking franchise in the equity landscape. Parallel to launching new products, the division also aims to expand into more rapidly growing sectors across the region. In Egypt, currency devaluations, coupled with the state’s privatization and reform program, are slated to

drive a surge in foreign investment inflows and bolster activity across the country’s capital markets, particularly on the M&A side. Shedding light on debt capital markets, the division aims to continue capitalizing on the high demand present both in Egypt and the broader region by infusing the market with a comprehensive set of both conventional debt products and innovative funding solutions that are not only tailored to changing market dynamics but also unlock the most potent growth prospects for the division and the Firm as a whole.

Research

Overview

EFG Hermes’ Research division is the region’s premier provider of in-depth, real-time market insights with macro, strategy, sector, and equity expertise provided by award-winning analysts. With 348 stocks under coverage in 40 sectors across 26 markets, the division sets the industry standard for delivering the most comprehensive and impactful FEM research to clients around the world.

With on-the-ground insights from analysts based across the Firm’s footprint, the division’s ability to provide differentiated research products that identify opportunities and allow clients to make informed investment decisions is unmatched. This has proved invaluable in 2022 considering the unprecedented geopolitical, as well as macroeconomic, turbulences that have threatened the stability of FEM and, in turn, impacted capital flowing into those markets from institutional and retail clients alike.

The division’s growing ability to constantly expand its coverage universe and tailor its product offering to the evolving needs of its clients has cemented its position in recent years as the research house of choice for equity and strategy research in FEM.

Operational Highlights of 2022

2022 was a particularly challenging year the world over, with geopolitical tensions in Europe, tightening monetary policy, and soaring inflation curbing investor sentiment and appetite in many of the markets under the Research division’s coverage. As such, the importance of fundamental and equity research insights came into even greater focus, and as a result, EFG Hermes Research continued to expand its coverage universe and hone its product offering.

The division, which currently has an on-ground presence in Egypt, Saudi Arabia, the UAE, the UK, Kenya, Bangladesh, and Pakistan, initiated coverage on 15 new stocks and was a key driver of the Firm’s IPO executions. The GCC bucked the global downturn in ECM activity to see c. USD 21 billion raised in offerings this year alone, with particularly big-ticket share sales seen in the UAE and Saudi Arabia, including Taaleem, Empower, The Pearl REIF, Salik, Ali Alghanim and Sons Automotive, Borouge, DEWA, Americana, and Riyadh Cables — all of which were completed by the Firm with research from the division.

This year saw an increased push into South Asian markets for the division, in line with the Firm’s overall strategy for its frontier market platform. The division’s Vietnam coverage was deepened, while the groundwork was made for initiations in new South Asian markets. As regulatory bodies continue to codify ESG reporting standards and investors turn to ESG and impact-focused investment solutions, EFG Hermes' Research division started to develop ESG scorecards this year for companies under coverage, which will allow clients to more consistently track and measure ESG metrics across companies in various industries.

The team is also taking decisive steps to digitalize the research experience for clients to leverage the success of the EFG Hermes Research Portal and employ data analytics and other techniques to provide clients with bespoke, impactful research. This year, the division revamped its research dissemination platform to allow the team to deliver insights to clients based on updates in the industry, market, economy, and more, while also al- lowing the team to gain unique, data-driven insights into client needs.

With COVID-19 restrictions easing, key investor conferences and access events returned, allowing the division to strengthen relationships with clients and lay the groundwork for value-accretive events in the year ahead to facilitate the sharing of ideas, building powerful networks, and fostering long-standing industry relationships.

The department’s ability to adapt to changing market dynamics and react to the developing needs of its increasingly varied client base has earned EFG Hermes' Research division several awards over the years, and 2022 was no different. EFG Hermes Research continued to rank highly in the Institutional Investor 2022 Poll, once again named the Top Frontier Research House and ranked third in the MENA region.

Forward-Looking Strategy

With the difficult circumstances faced last year — including a stronger USD, higher inflation, and tighter financial condi-tions — weighing on our markets through to the end of the year, valuations for FEM equities are attractive compared to developed markets. With higher profitability, free cash flow, and dividend yields all slated for a pick-up in our mar-kets — particularly in the GCC region — clients, investors, and analysts will continue to look for research houses for incisive, accurate, and timely research to help them navi-gate headwinds and capitalize on tailwinds. As the Firm’s Research franchise continues to expand and strengthen its offering, the division is perfectly positioned to capitalise on this demand going forward.

In the year ahead, the division is planning a push away from low-turnover African markets on the frontier side of the house to more attractive South Asian markets, such as Indonesia, Thailand, the Philippines, and more. It will also work on broadening the variety of its products, providing more diversified insights for the Firm’s client base and di-visions, including the development of a Research Primer for investors looking to break into the Asian market. On the MENA side of the house, the division is anticipating a wave of initiations as the GCC IPO boom sees no sign of slowing due to strong market fundamentals, abundant liquidity, and the UAE's push to bring more state-owned and private sector companies to the market.

The buy-side business delivered solid results this year, capitalizing on the growing demand for compelling and value-generating investment prospects, all while contributing to the Group’s consolidated revenue growth

Buy-Side Overview

Despite the year's market conditions on the back of geopolitical tensions that had knock-on effects on energy and commodity prices, the shrinking value of currencies in most emerging markets, and monetary tightening raising the alarm bells of recession, EFG Hermes continued to demonstrate resilience across its core operations. The strategies we set out in previous years shielded us from headwinds in 2022, as we worked to continue bringing to market varied, innovative financial offerings that allowed us to surpass regional benchmarks and peer averages. The buy-side business, in particular, delivered solid results this year, capitalizing on the growing demand for compelling and value-generating investment prospects, all while contributing to the Group’s consolidated revenue growth.

On the asset management side of the house, EFG Hermes’ Asset Management division recorded revenues of EGP 553 million in 2022, up 5% Y-o-Y from the EGP 528 million recorded at year-end 2021. Local and regional assets under management (AUM) both registered a solid increase during the year, with Egypt AUM growing 10% to record EGP 25.9 billion and regional AUM increasing 5.2% to stand at USD 2.7 billion. I am also happy to announce that the division was successful in further extending its regional presence this year, having established a new dedicated office in Muscat, Oman.

On the private equity side, the division’s flagship energy transition platform, Vortex Energy, continued to build on its strategic and fruitful partnership with Spain-based Ignis Energy Holdings, which facilitated a multitude of opportunities for the platform to continue growing its investment portfolio and broadening its outreach across various European countries. During the year, and through its recently launched fund Vortex Energy IV, Vortex Energy, along with its co-investors, injected the second tranche of its investment in Ignis Energy Holdings, worth c. EUR 228 million. Our partnership with such a globally renowned player not only enables us to cater to the growing demand present in the sustainable and responsible investing space but also to continue playing a fundamental role in contributing to the global transition toward a net-zero emissions future.

Alongside our success in the renewable energy space, 2022 was a solid year for our healthcare platform Rx Healthcare Management (RxHM), which continued to grow its operations in collaboration with leading medical solutions provider, United Pharma. I am delighted to say that we were successful in enhancing our production capacities and expanding our geographical footprint during the year, in line with our strategy to provide a better-rounded roster of innovative healthcare solutions across the region.

In the education sector, the year saw our full-fledged education-focused platform, the Egypt Education Fund (EEF), broaden its capacities in Egypt’s ever-growing education space by adding more prominent international schools to its portfolio. Leveraging its acquisition of Al Hayah International Academy back in 2021, the platform acquired Hayah West in Sheikh Zayed. Additionally, the EEF was successful in acquiring GEMS International School in Cairo (GISC) and Trillium the Montessori house, marking our strategic entry into the nascent pre-K segment. Branching out of Egypt’s capital, the EEF entered into an agreement with Abu Soma Development to establish a school in Soma Bay, which is set to kick off operations in 2024.

As a result of the solid performance delivered across all three platforms, the division closed the year with revenues of EGP 171 million, reflecting an increase of 57% Y-o-Y from the EGP 109 million booked in 2021.

Although the macroeconomic challenges we faced this year are expected to linger in 2023, I amconfident that both our Private Equity and Asset Management arms will continue to uphold their commitment to our stakeholders and will remain dedicated to building on the tremendous success achieved over the years. It is of utmost importance for us to continue sustaining our strong position in the regional markets in which we operate, and we aim to continue charging the market with investment prospects and innovative offerings that not only generate returns for our clients and bolster the Firm’s financial position but also create long-term, meaningful value on a regional scale.

Karim Moussa

Co-CEO of the Investment Bank

Asset Management

Overview

EFG Hermes’ Asset Management division, the MENA region’s leading asset manager, offers its clients a diverse and comprehensive suite of mutual funds and discretionary portfolios comprising of country-specific and regional mandates, including money market, fixed income, indexed, and Shariah- and UCTIS-compliant mandates. Powered by a team of regional industry experts, EFG Hermes' Asset Management division caters to an ever-growing client base of individual and institutional clients, as well as government-backed entities. The division unlocks value-accretive investment prospects, market insights, and other value-add services that are tailored to different individual preferences, financial objectives, and risk appetites.

Operational Highlights of 2022

Despite the challenges driven by inflationary pressures, higher interest rates, and currency devaluations, the MENA region’s capital markets remained resilient during the year. EFG Hermes’ Asset Management division ended 2022 on a strong note, winning new mandates, outperforming peer averages, and sustaining its leading position as the asset manager of choice across the region.

By the end of 2022, the division’s AUMs in Egypt had hiked by 10% Y-o-Y to record EGP 25.9 billion, up from the EGP 23.5 billion recorded at year-end 2021. The increase was primarily driven by the favorable performance of equity markets during the year, coupled with rising net inflows in money market funds (MMFs).

In 2022, the division won new mandates, outperformed peer averages, and sustained its leading position as the asset manager of choice in the region.

Despite the challenging market conditions, regional AUMs from the Firm’s regional arm, Frontier Investment Management (FIM) Partners, also grew in 2022 to record USD 2.7 billion, up 5.2% from the USD 2.6 billion booked one year previously, as the division delivered a solid performance across its funds and managed accounts, in addition to the growth in net inflows from equity port- folios. Additionally, FIM was successful in onboarding a new key account during the year, as a cornerstone of its strategy to broaden its investor network.

During the year, and in efforts to expand its regional presence, the Asset Management division successfully established a new office in Muscat, Oman.

Key Financial Highlights of 2022

Asset Management revenues rose by 5% Y-o-Y in 2022 to EGP 553 million, compared to the EGP 528 million reported in 2021, on the back of the higher incentive fees booked by the regional asset management arm, FIM.

Awards

In 2022, EFG Hermes Asset Management was named Best Asset Manager in Egypt and Pan-Africa by EMEA Finance African Banking Awards 2022 and was ranked 18th in Forbes Middle East’s Top 30 Asset Management Companies.

Forward-Looking Strategy

Going into 2023, the Asset Management division aims to continue delivering long-term value to its investors and other stakeholders and cementing its leading position across the regional markets in which it operates. The year ahead will see the division bring to market a wider range of innovative emerging market equity and fixed income products in efforts to complement its suite of existing offerings and to grow its roster of offerings in Egypt and region-wide. Capitalizing on the ever-growing importance of sustainable investing for individual and institutional investors alike, the division’s regional arm, FIM, continues to operate in accordance with the highest ESG investing standards, and it is in the process of enhancing its ESG policies to better serve changing investor dynamics across different asset classes.

Private Equity

Overview

EFG Hermes’ Private Equity platform drives value-accretive investments in sectors that are strategic and impactful by providing rapid and flexible investment capital. The platform’s unmatched capacity building and technical assistance, combined with its strategic leadership management, are some of the factors enabling it to grow its businesses swiftly across its footprint. As a long-term impact investor, the division invests in businesses operating in key industries — including renewable energy, education, and healthcare — that generate not only lucrative financial returns but also social and environmental impacts.

On the renewables front, the division manages investments through its dedicated Europe-focused platform, Vortex Energy. The platform, which was launched in 2014, funds projects in the fast-growing energy transition industry to drive higher sustainable development and lay the foundation for the transition toward clean energy. Today, Vortex Energy is a leading energy transition investment manager that seamlessly executes deal sourcing, structuring, financing, asset integration, and divestment on a global scale.

In the ever-growing education sector, EFG Hermes’ EEF is a USD 150 million investment fund that was launched in 2018. In line with its strategy to carry out socially impactful investments, EEF continues to grow and develop Egypt’s underserved K-12 sector through investments in schools and greenfield developments, in addition to building a vertically integrated platform to manage and enhance operations more effectively.

In the healthcare space, the Firm’s healthcare-focused investment platform, RxHM, was established to manage diverse investments across the healthcare sector to meet the rapidly growing demand for premium healthcare offerings across Egypt, the MENA region, and Africa at large. In 2019, the platform successfully completed the acquisition of a majority stake in United Pharma, a leading Egyptian medical solutions provider, in efforts to expand United Pharma’s medical product offerings across the region.

2022 Operational Highlights

Vortex Energy

2022 was a strong year for the Firm’s renewables-focused platform, primarily driven by the unprecedented surges in electricity prices on the back of the Russia-Ukraine war, which created higher demand for alternative energy solutions. By the end of 2022, Vortex Energy had invested a total of EUR 300 million into Ignis Energy Holdings, highlighting the strategic importance of its longstanding relationship with the company. Through this, Vortex Energy helped Ignis boost capacities and capture a share of the growing demand in Europe, led by the continents’ current energy crises and the need for more renewable energy resources.

RX Healthcare Management

RxHM delivered a strong set of operational and financial results in 2022 as it continued to bolster its production capacities through United Pharma. The platform witnessed substantial growth throughout the year, having successfully sourced a wider range of offerings across its portfolio, and broadened its geographical footprint through higher exports across the region.

Egypt Education Fund

In 2022, EEF continued to cement its position as the region’s largest performing education-focused platform, broadening its capacities in Egypt’s education sector and diversifying its investment portfolio of leading international schools. Following the addition of Al Hayah International Academy to the platform in 2021, the year saw the EEF acquire Hayah West in Sheikh Zayed. EEF also concluded new acquisitions during the year, including flagship GEMS International School in Cairo (GISC), and Trillium the Montessori house — the latter marking the platform’s first break into the burgeoning pre-K segment. Additionally, the platform entered into an agreement with Abu Soma Development Company to establish a new state-of-the-art school in Soma Bay. The school is slated to house a capacity of around 300 students and is set to commence operations in 2024.

To expand on its complementary services offered to students, EEF acquired "Selah El Telmeez", the leading Egyptian learning guide and content creator for K-12 students. Up-and-running since 1960, Selah El Telmeez is a brand trusted by millions of Egyptians, offering a broad range of books and digital learning materials across an array of subjects. By that same token, the acquisition of Option Travel in 2019 continued to bear fruit, with the platform’s school bus service performing exceptionally well during the year considering the return to in-person learning.

As a long-term impact investor, EFG Hermes' Private Equity division invests in businesses operating in key industries that generate not only lucrative financial returns but also social and environmental impacts.

Awards

During the year, EFG Hermes’ Private Equity division was recognized as the Best Private Equity House in Africa by EMEA Finance Awards 2021. Vortex Energy, in particular, won the Best Sustainable Private Equity Investment and the Best private equity fund raising in Africa by EMEA Finance Achievement Awards 2021. The division was also recognized as one of the leading private equity divisions in the region by IJ Global, having been shortlisted among some of the most prominent investment managers in the region for the Investment Manager of the Year award.

2022 Key Financial Highlights

Revenues for the division in 2022 recorded EGP 171 million, reflecting a 57% increase Y-o-Y from the EGP 109 million registered in 2021.

Forward-Looking Strategy

Looking ahead, the division aims to continue ramping up its portfolio to house a larger number of high-impact investments across its key areas of focus. On the renewables side, Vortex Energy plans to continue building on the success of its partnership with Ignis to grow its operational footprint on an international scale. As such, the flagship renewables platform is looking to venture into more sustainable and environmentally conscious fields, including energy storage and electrical vehicle (EV) charging.

On the education front, EEF continues to focus on strengthening its position as a full-fledged integrated education platform, leveraging educational institutions in the pre-K and K-12 space as well as complementary service offerings such as transportation and digital education materials. The platform also continues to seek out new value-generating prospects in the Egyptian education space, with an eye for branching out of Cairo and breaking ground in more underserved regions.

Shedding light on the healthcare side of the house, RxHM plans to continue broadening its healthcare portfolio by adding more acquisitions alongside United Pharma with entry into the IV and medical solutions space as it works to upscale the healthcare space and infuse the market with a wider range of comprehensive medical solutions.