GB Auto ER 4Q15 E FINAL 4

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

GB Auto 4Q & FY15 Results: Highlights

AUTO.CA on the Egyptian Exchange

Full Year 2015 Financial Highlights

GB Auto’s Shareholding Structure as of 31 December 2015

• GB Auto revenue for the full year of 2015 decreased by 0.5% to LE 12,264.7 million compared to LE 12,322.1 million in FY14.

41.3%

• Net income was LE 233.1 million in FY15, rising by 34% from LE 174.0 million in 2014. Net profit margin improved by 0.5 percentage points, coming to 1.9% at the end of the year. • Passenger Cars revenue witnessed a 15.9% drop year-on-year in FY15 to LE 7,489.9 million from LE 8,909.9 million in FY14.

58.7%

• Motorcycles and Three-Wheelers revenue rose 49.7% in FY15 to LE 1,997.2 million from LE 1,334.0 million in the year prior.

Ghabbour Family Free Float

• Commercial Vehicles and Construction Equipment revenue climbed up 45.5% during FY15 to LE 1,327.9 million from LE 912.9 million in FY14. • Tires posted revenue of LE 324.4 million, a 21.9% drop from LE 415.2 million in FY14. • Financing Businesses revenues stood at LE 1,046.2 million in FY15, a 44.8% increase over LE 722.7 million the previous year. • Others revenue reached LE 79.0 million, up 188.6% from LE 27.4 million in FY14 for Pre-Owned Vehicles, legacy fleet transportation contracts, and Lubricants.

Fourth Quarter 2015 Financial Highlights • GB Auto revenue in 4Q15 dropped 23% to LE 2,689.3 million from LE 3,491.5 million in 4Q14. • Net income came in at LE 28.1 million in 4Q15, a 12.3% drop from 4Q14 figures; net profit margin climbed 0.1 percentage points to 1.0%. • Passenger Cars revenue dipped 34.9% year-on-year to LE 1,498.8 million from LE 2,303.6 million in 4Q14. • Motorcycles and Three-Wheelers revenue fell 11.1% in 4Q15 to LE 485.9 million from LE 546.7 million in 4Q14. • Commercial Vehicles and Construction Equipment revenue closed the quarter at LE 286.8 million, an 8% increase from LE 265.5 million in 4Q14. • Tires revenue registered a 15.4% decrease in the quarter to LE 90.5 million. • Financing Businesses revenue increased by 14.5% to LE 294.4 million in 4Q15. • Others revenue came in at LE 32.9 million, growing by 184.2% for PreOwned Vehicles, legacy fleet transportation contracts, and Lubricants.

4Q / FY 2015 Earnings Newsletter

1

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

GB Auto Reports 4Q & FY15 Results

Leading auto industry player reports bottom-line growth for the year 2015, despite challenging macroeconomic backdrop and resultant operational difficulties.

It is my belief that difficult circumstances are when the best opportunities generally arise and we are fully confident we can face these headwinds and use them to our own benefit.

15 March 2016 — (Cairo, Egypt) GB Auto (AUTO.CA on the Egyptian Exchange), a leading automotive assembler and distributor in the Middle East and North Africa, announced today its consolidated results for the fourth quarter and full year of 2015, reporting revenues of LE 12,264.7 million for FY15, down 0.5% y-o-y. Net profit rose 34% y-o-y, closing the year at LE 233.1 million, with a net profit margin of 1.9%, an increase of 0.5 percentage points over FY14. “2015 is the first year to see GB Auto post a drop in its top-line since its IPO in 2007. However, the company’s performance this past year has been impressive, given current circumstances – especially the foreign currency shortage in Egypt,” said GB Auto Chief Executive Officer, Raouf Ghabbour. “The year has been a true testament to our incisive strategy and the competence and depth of our management approach. Moreover, following yesterday’s 14.3% devaluation of the EGP by the CBE, a very bold move in our opinion, we believe that foreign currency policy is on the right track and that the FX shortage will soon be behind us.” Overall, the Passenger Cars division saw revenues decline by 15.9% y-o-y in FY15 to LE 7,489.9 million from LE 8,909.9 million in the year before, on the back of a 21.2% decrease in sales volumes. The drop was mainly owing to a decrease in revenues from Iraq by half, but also to the impact of the foreign currency deficit in Egypt on import activities. The Motorcycles & Three-Wheelers line of business showed great resilience in the face of the foreign currency shortage, recording a 49.7% y-o-y increase in FY15 revenues, which stood at LE 1,997.2 million at year’s end. On the Commercial Vehicles & Construction Equipment front, the LOB remained solid, growing sales overall revenues by 45.5% over FY14 to LE 1,327.9, mainly on the back of increased volumes and revenue from the bus segment. Tires, on the other hand, saw revenues decline by 21.9% y-o-y during the year to reach LE 324.4 million from LE 415.2 million. The division was hit the hardest by the FX blow, as delays in currency allocation made it difficult to meet market demand and cost the company much in demurrages. However, the Tires division began showing signs of recovery starting 4Q15. Meanwhile, our Financing Businesses reported excellent results, posting a 44.8% increase in overall revenues as compared to 2014, which reached LE 1,046.2 million at the end of the financial year. Our newest financing venture Tasaheel has also recorded promising results during its first quarter in operation, and management is confident it is bound for the same success achieved by GB Capital’s other financing businesses. “It is my belief that difficult circumstances are when the best opportunities generally arise and we are fully confident we can face these headwinds and use them to our own benefit,” said Ghabbour. “It is in times like these that we must begin to invest and work hard to place ourselves in a position that will allow us to capture greater returns and rewards from the inevitable market rebound. “I am well aware that we are not out of the woods yet and that the times ahead will come with their own set of challenges,” Ghabbour continued. “Luckily, our experience is vast when it comes to dealing with difficulties and our strategies for current times were developed from that same playbook that successfully carried us through trying times such as Egypt’s first currency crisis in 1981, the global financial crisis of 2009, and the political turbulence that began in 2011. I remain confident in the underlying fundamentals of the Egyptian automotive market now that our economy is on the right track.” GB Auto is heading into 2016 with five different CKD models compared to only two last year, marking an important milestone in two decades of car assembly operations. Among key operational highlights this year is GB Auto’s tripartite agreement with Egypt’s Aboul Fotouh Automotive and China’s Chery International, which will see the company become the exclusive distributor of Chery in Egypt. Together, GB Auto and AF Automotive’s combined capacity could reach up to 90,000 vehicles per annum. Highlights of GB Auto’s 4Q and FY15 results follow, along with management’s analysis of the company’s performance. Complete financials are available for download on ir.ghabbourauto.com. 2

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Fourth Quarter 2015 at a Glance (all figures in LE million)

Revenues

Gross Profit Contribution by Line of Business

Revenue Contribution by Line of Business

Key Indicators

3,491.5 2,818.9

2.7%

1.9% 5.4%

4.8% 2.0%

0.1%

1.4%

-1.0%

2,354.2 1,877.5

Passenger Cars

25.4 %

13 .6%

2,689.3

76 .3%

67.5%

4Q11

4Q11

4Q12

4Q13

4Q14

3.3%

4Q15

4.6%

6.0% 2.8%

-0.7%

70 .3 %

347.5

68 .3%

4Q12

Financing Businesses Startups

22.4%

409.3

18.4%

413.5 354.9

Commercial Vehicles & Construction Equipment Tires

3.4%

1.1%

Gross Profits

Motorcycles & ThreeWheelers

243.0

5.5% 3.3% 4.6%

-0.1%

-1.8%

11.1%

4Q14

4Q15

4Q13 EBIT

3.0%

72

.2

%

235.4 206.7

65. 3%

4Q13

18.7%

4Q12

14.6%

3.8% 4Q11

175.6 131.9

7.4%

130.1

3.1%

0.3%

-0.3%

13.1%

3.5%

7.6%

4Q14

4Q15

24

.1%

4Q13

.2

Net Income

54

4Q12

66 .0%

4Q14 4Q11

15.7%

5.3%

%

77.5

1.8%

1.2%

.6%

3.4%

% .1 18

4Q12

4Q13

4Q14

4Q / FY 2015 Earnings Newsletter

10.0%

.7%

4Q15

55

28.1

10.7

32.1

4Q11

4.1%

%

45.1

43.6

16

44. 0%

10.9%

23. 4%

4Q15

3

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Full Year 2015 at a Glance Gross Profit Contribution by Line of Business

Revenue Contribution by Line of Business

(all figures in LE million)

Revenues

2.1%

2.2% 4.6%

0.1%

0.7%

FY11

FY11

FY12

FY13

FY14

3.5%

FY15

5.6%

3.0%

4.0%

1,170.3

Tires Financing Businesses Startups

21.3%

14.6 %

-0.9%

67 .2%

1,071.6

FY12

6.4%

73 .2 %

1,581.7 1,594.4

Motorcycles & ThreeWheelers Commercial Vehicles & Construction Equipment

1.9%

Gross Profits

-1.0%

Passenger Cars

28.8%

8,290.1

9,126.7

77 .4%

7,415.3

13 .5%

12,322.1 12,264.7

4.3% 2.8%

64.4%

Key Indicators

883.3

5.3% 4.3% 5.3%

5.0%

FY15

EBIT

3.2%

%

FY13

71

.6

857.4 750.2 586.5

5.9% 3.4%

0.2%

7.4%

FY14

FY15

FY14

63

Net Income 233.1

219.4 174.0

2.6%

2.3%

FY14

4Q / FY 2015 Earnings Newsletter

FY15

61

.1%

10 FY13

.7%

14

% .7 21

FY12

3% 16.

FY15

0.6%

0.6%

.8%

116.0

8.5%

11.0%

190.6

FY11

.9%

FY13

10.7%

6.2%

72 .3%

FY12

4.0%

10.8%

FY11

-0.3%

49. 7%

616.5 519.2

10.6%

65. 5%

FY14

16.3%

FY13

15.5%

FY12

13.5%

FY11

-0.6%

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GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Passenger Car Revenue Breakdown by Segment

0.1%

43.0%

39.6%

4Q13

3.9%

12.3%

4.5%

9,686 9,590

18. 5%

4Q13

11,484

4Q14

.1% 13

61.3%

2.3%

4Q14

GB Auto is a leading passenger car importer, assembler and distributor in the Middle East and North Africa. In Egypt, it is the largest player in the market, as the sole representative of Hyundai, Geely Emgrand, Mazda, and Chery passenger cars, and owns the biggest nationwide distribution and after-sales service networks of any brand. Regionally, GB Auto distributes Hyundai passenger cars in Iraq and Geely Emgrand passenger cars in Algeria. GB Auto serves the Egyptian market with both Completely-Knocked-Down (CKD) and Completely-Built-Up (CBU) products, while operating in Iraq and Algeria with CBU units. Breakdown of Units Sold, all brands and markets*

1.1%

0.3%

Passenger Car Line Of Business

4Q15

9,763 6,948 5,846

CBU** CKD**

*Markets currently include Egypt, Iraq, and Algeria; Iraq and Algeria are CBU only ** CBU refers to Completely -Built-Up units; CKD refers to Completely-Knocked-Down units

Egypt

4Q15

4.6% 6.5%

Hyundai Egypt Geely Egypt Mazda Egypt Hyundai Iraq Others* After-Sales * Others includes Geely Libya, Geely Algeria and Karry Egypt

4Q / FY 2015 Earnings Newsletter

66.0 %

12

.6%

2.8%

7.5%

• According to the Egyptian Automotive Marketing Information Council (AMIC), the Egyptian Passenger Car market in FY15 witnessed a 6% drop in total sales volumes in 2015, falling from 207,973 in FY14 to 195,559 units this year. Brands within the 1.0 - 1.3 liter range witnessed a 14% y-o-y decline in volumes, while those within the 1.3 - 1.5 liter range fell by 22%. Meanwhile, brands within the 1.5-1.6 liter saw sales volumes increase by 5%, while SUVs with an engine capacity larger than 2.0 liters saw volumes rise by 27%. • GB Auto’s Passenger Cars total sales volumes and revenues witnessed a decline of 14.6% and 3.4%, respectively, during FY15. The drop came on the back of difficulties sourcing foreign currency due to a shortage in the Egyptian market whose effects were accentuated during the second half of the year, particularly in the fourth quarter. The shortage impacted GB Auto’s ability to finance imports and restock its inventory. • The rumors and uncertainties surrounding the future of car prices in Egypt have also affected demand, mostly during the second half of the year. It is worth mentioning that demand for Passenger Cars customarily wanes during the last quarter of the year, especially in December. • Management is confident the company is well-positioned to capitalize on the pent-up demand once the market’s appetite recovers. • Across all brands, GB Auto held a total market share of 26.8% (including Hyundai, Geely Emgrand and Mazda) in FY15, 3 percentage points below FY14’s share of 29.8%. Hyundai’s total market shares increased to 22.2% in 2015 from 21.6% in 2014. • Hyundai CBU sales increased by 4.8% y-o-y in FY15, while CKD sales declined by 11.7%, due to disruptions in assembly operations due to the aforementioned foreign currency crunch. • The fourth quarter saw Mazda continue its upward trend, increasing sales vol5

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

The drop came on the back of difficulties sourcing foreign currency due to a shortage in the Egyptian market whose effects were accentuated during the second half of the year, particularly in the fourth quarter. The shortage impacted GB Auto’s ability to finance imports and restock its inventory.

•

•

•

•

umes by 6.9% as compared to 4Q14, and showing growth of 135.4% y-o-y for the full year of 2015. Geely CBU sales volumes increased by 12.7% y-o-y during FY15, while CKD sales fell by 61.6%. Since its launch, GB Auto sold over 30 thousand units of Geely’s Emgrand 7 model, however, sales during 2015 were impacted a negative social media campaign that the company dealt with decisively through obtaining third-party quality certifications proving the erroneousness of the claims on social media. The Passenger Cars After-Sales division continued on its gradual growth trajectory, posting strong results for both 4Q15 and FY15. The division reported revenue and gross profit growth of 15.4% and 33.3%, respectively, for the full year. Management intends to establish additional after-sales centers in new locations such as Upper Egypt and the North Coast to meet the ever-increasing capacity, which has nearly doubled over the last two years. Sales of Chinese Chery vehicles are expected to boost the division’s performance as they commence in March 2016, and management is optimistic about the brand’s performance in the Egyptian market owing to these models’ previous success witnessed prior to the production halt. The company had entered into a tripartite agreement with the Chinese manufacturer as well as the Egyptian AF Automotive in the third quarter of 2015. (See Recent Corporate Developments). The addition of Chery’s two new CKD models, alongside the Hyundai Elantra, will mean that by the end of 1Q16, GB Auto will be offering five CKD models compared to only two in 2015.

Iraq

• Conditions in the Iraqi market continued to negatively impact our operations, largely due to the country’s sluggish economic backdrop as well as oversupply problems carrying through from the previous quarter. From a comparative standpoint, GB Auto’s position in the market is better than most in terms of bank debt, stocks, and foreign currency. • As is the case with many other businesses in Iraq, there is limited visibility on future conditions. GB Auto intends to maintain its operations and management is ready to take the best course of action in whatever situation the company is faced with.

Algeria

• Like Egypt, the Algerian market is also facing challenges brought on by foreign currency shortages and restrictions on imports. Car imports into the country are temporarily suspended, pending regulatory changes. • The company liquidated much of its stock in the country, and only 250 units remain that management intends to sell entirely during the first quarter of 2016. • Despite these difficulties, management is optimistic about the recovery of this potentially lucrative market and is still pursuing additional opportunities for long-term growth.

Table 1A: Total Passenger Car Sales Activity — All Brands and Markets

Total Sales Volume Sales Revenue Gross Profit Gross Profit Margin After-Sales Revenue After-Sales Gross Profit After-Sales Gross Profit Margin Total Passenger Car Revenues Total Passenger Car Gross Profit Passenger Car Gross Margin 4Q / FY 2015 Earnings Newsletter

(Units) (LE million) (LE million) (%) (LE million) (LE million) (%) (LE million) (LE million) (%)

4Q14 21,247 2,200.7 193.9 8.8% 102.8 29.8 29.0% 2,303.6 223.7 9.7%

4Q15 12,794 1,386.8 140.9 10.2% 111.9 39.2 35.1% 1,498.8 180.1 12.0%

% Change 4Q14 v 4Q15 -39.8% -37.0% -27.3% 1.3 8.8% 31.5% 6.1 -34.9% -19.5% 2.3

FY14 83,780 8,535.4 891.8 10.4% 374.5 118.9 31.8% 8,909.9 1,010.8 11.3%

FY15 66,034 7,056.0 642.3 9.1% 433.9 150.7 34.7% 7,489.9 793.0 10.6%

% Change FY14 v FY15 -21.2% -17.3% -28.0% -1.3 15.9% 26.7% 3.0 -15.9% -21.5% -0.8

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GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Table 1B: Passenger Car Sales Activity — Egypt

CBU Sales Volume (Hyundai) CBU Sales Volume (Geely) CBU Sales Volume (Mazda) CKD Sales Volume (Hyundai) CKD Sales Volume (Karry) CKD Sales Volume (Geely) Total Sales Volume Sales Revenue Gross Profit Gross Profit Margin After-Sales Revenue After-Sales Gross Profit After-Sales Gross Profit Margin Total Egypt Passenger Car Revenues Total Egypt Passenger Car Gross Profit Passenger Car Egypt Gross Margin

(Units) (Units) (Units) (Units) (Units) (Units) (LE million) (LE million) (%) (LE million) (LE million) (%) (LE million) (LE million) (%)

4Q14

4Q15

% Change 4Q14 v 4Q15

FY14

FY15

% Change FY14 v FY15

7,272 283 333 5,704 4,059 17,651 1,767.9 184.7 10.5% 84.1 23.2 27.6% 1,852.1 207.9 11.2%

4,017 253 356 4,688 84 1,074 10,472 1,162.2 170.7 14.7% 94.9 33.5 35.3% 1,257.1 204.2 16.2%

-44.8% -10.6% 6.9% -17.8% -73.5% -40.7% -34.3% -7.6% 4.2 13.0% 44.4% -32.1% -1.8% 5.0

21,229 1,269 823 24,185 14,950 62,456 5,911.7 662.2 11.2% 314.6 97.5 31.0% 6,226.3 759.8 12.2%

22,239 1,430 1,937 21,356 618 5,744 53,324 5,713.1 647.9 11.3% 363.0 130.0 35.8% 6,076.1 777.9 12.8%

4.8% 12.7% 135.4% -11.7% -61.6% -14.6% -3.4% -2.2% 0.1 15.4% 33.3% 4.8 -2.4% 2.4% 0.6

Table 1C: Hyundai Passenger Car Sales Activity — Iraq

Total Sales Volume Sales Revenue Gross Profit Gross Profit Margin After-Sales Revenue After-Sales Gross Profit After-Sales Gross Profit Margin Total Iraq Passenger Car Revenues Total Iraq Passenger Car Gross Profit Passenger Car Iraq Gross Margin

(Units) (LE million) (LE million) (%) (LE million) (LE million) (%) (LE million) (LE million) (%)

4Q14

4Q15

% Change 4Q14 v 4Q15

FY14

FY15

% Change FY14 v FY15

3,465 426.0 11.2 2.6% 11.9 7.0 58.8% 437.8 18.2 4.2%

1,779 189.0 -22.6 -11.9% 15.4 5.2 34.1% 204.4 -17.3 -8.5%

-48.7% -55.6% -14.6 29.6% -25% -24.7 -53.3% -12.6

19,606 2,505.3 228.8 9.1% 49.2 21.0 42.7% 2,554.4 249.8 9.8%

10,985 1,230.4 1.8 0.1% 64.3 19.3 30.0% 1,294.7 21.1 1.6%

-44.0% -50.9% -99.2% -9.0 30.7% -8.1% -12.7 -49.3% -91.5% -8.1

4Q14

4Q15

% Change 4Q14 v 4Q15

FY14

FY15

% Change FY14 v FY15

6.9 -0.3 -4.9% 6.9 -0.3 -4.9%

358 21.1 1.6 7.8% 1.6 0.5 31.0% 22.7 2.2 9.5%

-76.1% 35.9 14.4

10.7 0.4 3.7% 10.7 0.4 3.7%

1,278 74.1 5.4 7.3% 6.7 1.4 21.5% 80.7 6.8 8.4%

-37.8% 17.8% 4.7

Table 1D: Passenger Car Sales Activity — Algeria

Total Sales Volume Sales Revenue Gross Profit Gross Profit Margin After-Sales Revenue After-Sales Gross Profit After-Sales Gross Profit Margin Total Algeria Passenger Car Revenues Total Algeria Passenger Car Gross Profit Passenger Car Algeria Gross Margin

(Units) (LE million) (LE million) (%) (LE million) (LE million) (%) (LE million) (LE million) (%)

* A  s estimated by the Automotive Marketing Information Council of Egypt (AMIC). Please note that AMIC figures are based on individual companies willingly contributing / reporting their sales and that GB Auto cannot check the full accuracy of these or guarantee that all companies operating in Egypt report to AMIC. ** As estimated by the Automotive Marketing Information Council of Egypt (AMIC).

4Q / FY 2015 Earnings Newsletter

7

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Motorcycle & ThreeWheeler Revenue Breakdown by Segment

Motorcycle & Three-Wheeler Line of Business GB Auto is the Egyptian distributor for Bajaj three-wheelers (“tuktuks”) and motorcycles.

3.0% % .5 16

Breakdown of Units Sold

4Q13

20,441

4Q13 80 .4%

11,180 25,397

4Q14

13,737

3.6

4Q14

Three-Wheelers

19,340

4Q15

% .6 15

Motorcycles

12,665

Motorcycles & Three-Wheelers 80 .8%

• The Motorcycles & Three-Wheelers division reported strong results for FY15, posting an increase of 40.3% y-o-y in sales volumes and a 49.6% increase in revenues over FY14 figures. Gross profit also rose by 40.9% and management believes the division still has ample room to grow and expand further. • The division’s Aftersales revenue and gross profit also witnessed increases, rising by 51.5% and 47.0% y-o-y, respectively, witnessing growth in both the Egyptian and Iraqi markets. • GB Auto’s current facilities in Egypt are considered to be the first motorized assembly line of production for Bajaj Three-Wheelers outside of India. The company is finalizing agreements to install new painting and welding shops with considerable components and process localization. Proceeds from the recently finalized capital increase through rights issue will in part be used to finance this expansion. • Management has also launched sales of these vehicles in Iraq, and unit sales so far have been promising. GB Auto has sold a total 850 units since sales began, and GB Auto also operates a small service center and spare parts outlet in Baghdad, and has recently added a second in the area of Al Najaf that also includes a Bajaj showroom.

18 .2%

5.7%

75 .2%

4Q15

Three-Wheelers Motorcycles After-Sales

Table 2: Motorcycle & Three-Wheeler Sales Activity — Egypt and Iraq

Three-Wheeler Sales Volume Motorcycle Sales Volume Total Sales Volume* Sales Revenue Gross Profit Gross Profit Margin After-Sales Revenue After-Sales Gross Profit After-Sales Gross Profit Margin Total Motorcycle & ThreeWheeler Revenues Total Motorcycle & ThreeWheeler Gross Profit Motorcycle & Three-Wheeler Gross Margin 4Q / FY 2015 Earnings Newsletter

4Q14

4Q15

% Change 4Q14 v 4Q15

FY14

FY15

% Change FY14 v FY15

(Units) (Units) (Units) (LE million) (LE million) (%) (LE million) (LE million) (%)

25,397 13,737 39,134 527.0 96.3 18.3% 19.7 3.7 18.9%

19,340 12,665 32,433 458.2 90.3 19.7% 27.7 5.6 20.1%

-23.8% -7.8% -17.1% -13.1% -6.3% 1.43 41.0% 49.8% 1.2

61,068 36,801 97,869 1,271.2 234.2 18.4% 62.8 11.4 18.1%

85,808 51,065 137,301 1,902.1 330.0 17.3% 95.1 16.7 17.5%

40.5% 38.8% 40.3% 49.6% 40.9% -1.1 51.5% 47.0% -0.5

(LE million)

546.7

485.9

-11.1%

1,334.0

1,997.2

49.7%

(LE million)

100.0

95.8

-4.2%

245.6

346.7

41.2%

(%)

18.3%

19.7%

1.4

18.4%

17.4%

-1.0

8

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Commercial Vehicles & Construction Equipment Revenue Breakdown by Segment % .2 23

9% 11.

4.6% 6.9%

4Q13

1.4%

52.0 %

6.3% 2.7%

8.5%

Commercial Vehicles & Construction Equipment Line of Business The Commercial Vehicles & Construction Equipment line of business offers a wide range of trucks and locally manufactured buses under exclusive distributorship agreements with Mitsubishi, Volvo and Iveco. GB Auto manufactures and distributes semi-trailers and superstructures (i.e. oil and chemical tankers as well as concrete mixers). In Egypt, this line of business also distributes earth-moving equipment, road machinery and power generators under distribution agreements with Volvo Construction, SDLG and Aksa, as well as YTO tractors, and produces buses for domestic and export markets through GB Polo (a joint venture between Ghabbour and Marcopolo, the world’s larges bus body manufacturer).

16 .4%

Breakdown of Units Sold

1.2%

4Q14 86 354

4Q13

64.8 %

57 5 111 157 812

4Q14 25

10.8%

13. 3%

1.2% 0.9%

80

.4% 27

4Q15

102

482

4Q15 54 14 74

46.2%

Buses Trucks Tractors Trailers Construction Equipment After-Sales

4Q / FY 2015 Earnings Newsletter

Buses

205

Trucks Tractors Trailers Construction Equipment

• The Commercial Vehicles & Construction Equipment line of business saw total revenues and gross profit rise by 45.5% and 79.3%, respectively, over FY14. Although most of our products in this category saw an increase sales volumes, truck unit sales witnessed a decrease, mainly due to the effects of the nationwide foreign currency shortage on company imports. • Buses were the top-performers in this segment, witnessing increases across the board, thanks to a government tender that saw GB Auto supply Egypt’s Public Transport Authority with 450 city buses for Cairo and Alexandria in 2015. • During the quarter, GB Polo delivered the first CTA buses assembled on Volvo chassis to a committee of CTA inspectors, who approved the order upon first inspection. The success of this order is a testament to GB Auto’s ability to benefit from the sharing of knowledge and expertise and deliver international quality standards to the local market.

9

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

• The company is expected to supply the Cairo Authority with an additional 149 units by the end of June, which will be followed by another batch of 90 units to the Alexandria Transport Authority in the second half of 2016. The delivery of these units will help strengthen GB Polo and GB Auto’s market standing in the city bus segment. • Management has noted the Cairo Transport Authority is looking into signing agreements with private fleet owners to operate certain city lines and that GB Auto is currently in talks with the authority. • Trucks reported a volume drop in FY15 as compared to FY14, impacted by currency shortages in the third and fourth quarters of the year. Management expects new product offers, that now cater to high- and low-end segments, will help ramp-up the division’s performance during 2016. • Meanwhile, the Trailers division’s unit sales doubled during 2015, and showed an increase of 3.9% in revenue.

Table 3: Commercial Vehicles and Construction Equipment (CV&CE) Sales Activity

Bus Sales Volume Truck Sales Volume Tractor Sales Volume Trailer Sales Volume Construction Equipment Sales Volume Total Sales Volume Sales Revenue Gross Profit Gross Profit Margin After-Sales Revenue After-Sales Gross Profit After-Sales Gross Profit Margin Total Commercial Vehicles & Construction Equipment Revenue Total Commercial Vehicles & Construction Equipment Gross Profit Commercial Vehicles & Construction Equipment Gross Margin

4Q / FY 2015 Earnings Newsletter

4Q14

4Q15

% Change 4Q14 v 4Q15

FY14

FY15

% Change FY14 v FY15

(Units) (Units) (Units) (Units) (Units) (Units) (LE million) (LE million) (%) (LE million) (LE million) (%)

157 812 102 25 80 1,176 242.8 19.5 8.0% 22.7 2.6 11.4%

205 482 54 14 74 829 255.7 36.7 14.4% 31.1 4.4 14.1%

30.6% -40.6% -47.1% -44.0% -7.5% -29.5% 5.3% 87.9% 6.3 37.0% 69.8% 2.7

1,055 2,292 208 147 474 4,176 838.7 86.1 10.3% 74.2 12.0 16.1%

1,172 1,415 134 224 222 3,167 1,216.9 158.1 13.0% 111.0 17.7 15.9%

11.1% -38.3% -35.6% 52.4% -53.2% -24.2% 45.1% 83.7% 2.7 49.7% 47.8% -0.2

(LE million)

265.5

286.8

8.0%

912.9

1,327.9

45.5%

(LE million)

22.1

41.1

85.8%

98.1

175.8

79.3%

(%)

8.3%

14.3%

6.0

10.7%

13.2%

2.5

10

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Tires Line of Business GB Auto has agreements with a number of Original Equipment Manufacturers (OEMs) to distribute a wide variety of tires in five countries. In Egypt, the company distributes Lassa, Yokohama, Westlake and Double Coin tires, while it distributes Westlake, Diamond Back and Jumbo tires in Iraq. In Jordan, the company distributes Diamond Back, Triangle and Jumbo tires; and in Algeria it distributes Lassa, Grandstone and, most recently, Goodyear tires.

Table 4A: Total Tires Sales Activity

Total Sales Revenues Total Gross Profit Gross Margin

• Revenues and profitability at the Tires line of business suffered from the severe foreign currency shortage in Egypt as well as the challenging geopolitical conditions in the region. Despite that, our Tires division has reported solid results in 4Q15 with revenues growing by 33.3% q-o-q while gross profit margin improved to 18.7% in 4Q15 from 4.4% in 3Q15. • GB Auto is also fine tuning its overall go-to market approach through a number of activities aimed at increasing market share and lifting profitability across the region and to start 2016 on a more solid footing. Among these efforts are, 1) the optimization of our brand portfolio to cover new profitable segments (Double Coin for trucks and light trucks, OTR tires in Egypt, Avon tires for passenger cars and SUVs in Jordan and Iraq as well as Primo for Agri-tires in Egypt.); 2) Consolidating our position in the passenger car retail channels to improve the distributed volumes and cement our position in direct sales to heavy truck fleets and; 3) Shifting our payment terms to an all-cash system for 80% of our Egyptian tire business and the re-organization of our sales force to achieve a more effective coverage of key areas in Egypt and Algeria. • GB Auto confirms its short-term plans to launch a tire manufacturing facility in the region to lock-in supplies of products appropriate to its markets while also catering to strong local demand in the GCC and MENA regions. Negotiations are ongoing with technology partners to grant the most suitable product portfolio and competitive cost structure for the project. Overall required capacity will be above 100,000 tons which will support our cost competitiveness.

(LE million) (LE million) (%)

4Q14

4Q15

% Change 4Q14 v 4Q15

FY14

FY15

% Change FY14 v FY15

107.0 14.6 13.7%

90.5 16.9 18.7%

-15.4% 15.9% 5.1

415.2 63.7 15.3%

324.4 36.0 11.1%

-21.9% -43.4% -4.2

4Q14

4Q15

% Change 4Q14 v 4Q15

FY14

FY15

% Change FY14 v FY15

75.1 12.5 16.7%

59.8 14.7 24.5%

-20.3% 17.0% 7.8

315.4 56.2 17.8%

203.2 27.5 13.6%

-35.6% -51.0% -4.3

4Q14

4Q15

% Change 4Q14 v 4Q15

FY14

FY15

% Change FY14 v FY15

32.0 2.1 6.5%

30.7 2.27 7.4%

-3.9% 9.0% 0.9

99.8 7.5 7.5%

121.2 8.5 7.0%

21.5% 13.3% -0.5

Table 4B: Tires Sales Activity — Egypt

Total Sales Revenues Total Gross Profit Gross Margin

(LE million) (LE million) (%)

Table 4C: Tires Sales Activity — Regional

Total Sales Revenues Total Gross Profit Gross Margin 4Q / FY 2015 Earnings Newsletter

(LE million) (LE million) (%)

11

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Financing Line of Business GB Auto’s future strategy aims to create a full-fledged financial arm that serves its core business while competing aggressively with other non-bank financial service providers. GB Capital is the driver of this strategy. Today, GB Capital oversees the operations of the group’s five financial service providers: GB Lease, which offers financial leasing services to a wide range of companies; Mashroey, which offers assetbased lending to microfinance eligible clients throughout Egypt; Drive, which offers factoring services to individuals and companies; Haram Limousine, which offers car rental services on a quasi-operational lease basis to companies in the market; and most recently Tasaheel, which similar to Mashroey, offers direct microfinance lending services to micro entrepreneurs throughout Egypt. GB Capital’s strategy is to benchmark its operations against the best in the field, building on strict and robust credit policies specifically developed for each industry. All companies are staffed with veterans of the financial services industry to provide the required expertise and know-how, and all companies work on a non-exclusive basis with GB Auto to ensure the competitiveness of operations. The companies’ credit approval and disbursement mechanisms are well-advanced and comply with best practices of financial institutions in the country. Furthermore, asset quality and collections — the backbone for the success of any financial institution — are closely monitored, well-maintained and controlled within the group. The aim of GB Capital is to develop a well-diversified and synergetic group of financial services, building on the spirit and strategy of GB Auto while maintaining a high level of focus and specialized expertise within each company. To that end, GB Capital is also on the lookout for new additions to complement its portfolio. • GB Auto’s Financing Businesses maintained its solid performance during 4Q15, reporting strong results for both the 4Q and FY15 and contributing about 44% of the company’s bottom line. • The Financing Businesses under GB capital are on a path of constant growth; overall revenues for FY15 increased by 44.8% to LE 1,046.2 million compared to LE 722.7 million in FY14. Total gross profit rose to LE 233.8 million in 2015 from LE 168.6 million the year before, showing an increase of 38.5% y-o-y. • At 22.3%, gross profit margin, albeit 1% lower than FY14, improves with each quarter and remains robust compared to market norms. Nonetheless, it is to be noted that gross profit margin is an unusual measurement of profitability or operations for financial institutions, where the latter focus on net bottom line, ROE, and portfolio quality. Along these measurement criteria, the Financing Businesses reported a net bottom line of LE 99.6 million for FY15, up 56.9% y-o-y, and maintained a very healthy loan portfolio quality with non-performing loans under 0.61% with a coverage ratio in excess of 100%. ROAE stands at 26.2%. • The Financing Business model is built on the companies’ ability to obtain leverage to fuel their lending portfolios, which widely differs from the trading or manufacturing business model in terms of amount of debt incurred and the tenor of such debt by any company. All companies under GB Capital remain strongly under-leveraged compared to industry norms and regulatory caps which, in light of the nature of the business (especially for GB Lease, Drive and Tasaheel), al-

4Q / FY 2015 Earnings Newsletter

12

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

•

•

•

•

•

• •

lows the companies to borrow up to 8x Shareholders’ Equity. Total leverage for the Financing Businesses stood at 2.74x as at December 31, 2015. GB Lease maintained its position as a leading performer in the Financing Businesses, and continued to have a strong foothold in the market during FY15, reporting a top-line increase of 56.5% y-o-y. By law, GB Lease provides business-to-business financial leasing solutions. It is non-exclusive to GB Auto and caters to a diversified client base. GB Lease’s asset base is diversified, including real estate, automotive, production lines and other asset classes. Tenor is medium term, and the company’s focus is on risk diversification by asset class, industry sector and clients. It operates prudent risk management practices with respect to provisions and risk recognition. Mashroey closed the year as the top-performer of this line of business, exhibiting top-line growth of 32.7% y-o-y compared to FY14. The company maintains an extensive products base, with the bulk of its portfolio geared toward asset-based lending to finance the purchase of TukTuks and Tricycles, and with new products in the pipeline. Mashroey’s credit policy is stringent, its portfolio tenor is predominantly short term and it operates a nationwide network of over 80 branches and units. Drive offers factoring services to a well-diversified client base, ranging from business-to-business (SMEs) to business-to-consumer (retail). It has continued with its solid growth, posting a 49% y-o-y increase in top-line for FY15. Drive continues to expand its factoring solutions, offering innovative financing products. Operating under a robust credit policy, the company’s portfolio tenor is predominately medium term. Haram Tourism Transport “HTT” (also known as Haram Limousine) recorded y-o-y top-line growth of 31.9% in FY15. The company operates as a car rental / quasioperational lease company and serves a select range of top-tier industrial, service and multinational companies. Its service agreements are tailored, and entail acquisition, registration, insurance and maintenance of the vehicles, with third-party insurance in place. Average tenor of the portfolio is three years. Tasaheel, GB Capital’s most recent financing venture, recorded LE 2.2 million in revenue since its launch in August 2015. Tasaheel was founded with an authorized capital of LE 40 million of which LE 20 million were paid in during 2015, with the remaining LE 20 million earmarked for 1Q16. The company is 90% owned by GB Capital and 10% by EQI. Tasaheel operates as a non-bank financial services company, operating under the Microfinance Law # 141 for the year 2014. It focuses on direct lending to microfinance eligible clients — predominately group lending to women — with the aim of helping low income earners generate higher incomes and improve their living standards, and in doing so also support overall community development and economic growth. GB Lease, Drive and Tasaheel are regulated under the Egyptian Financial Supervisory Authority (EFSA). Management notes that as Mashroey, Drive and Haram Tourism Transport transact with the Passenger Cars and the Motorcycles & Three Wheelers lines of business, there are invariably intercompany sales between these units. Results after elimination of these intercompany sales are summarized in Table 5 (below).

Table 5: Financing Businesses Activity

Total Sales Revenues Total Sales Revenues after Intercompany Elimination Total Gross Profit Gross Margin*

4Q14

4Q15

% Change 4Q14 v 4Q15

FY14

FY15

% Change FY14 v FY15

(LE million)

375.4

432.6

15.2%

1,113.4

1,587.1

42.5%

(LE milllion)

257.2

294.4

14.5%

722.7

1,046.2

44.8%

(LE million) (%)

54.1 21.0%

67.9 23.1%

25.6% 2.0

168.8 23.4%

233.8 22.3%

38.5% -1.0

* Please note that Gross Margin is calculated on total revenues after intercompany elimination.

4Q / FY 2015 Earnings Newsletter

13

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Startups GB Auto’s Pre-Owned Vehicles division — branded Fabrika — is rolling-out a western-style, pre-owned car operation at all GBowned points of presence in Egypt. Our newly launched Lubricants business — PAL — distributes G-Energy and Gazpromneft products at GB Auto-branded and third-party points of sales in the Egyptian market under an exclusive strategic alliance with Gazpromneft Lubricants. Our Retail arm will operate retail After-Sales outlets to distribute tires, tire parts, batteries, parts and lubricants. These points of presence will also offer services including tire installation and balancing, battery service and the sale and injection of lubricants in select locations. • PAL operations showed substantial and promising growth in 2015, as revenues jumped to LE 33.9 million from to LE 2 million in FY14.The division’s sales and profits were in-line with management’s expectations and GB Auto anticipates further announcements regarding new product representations within company-branded service centers and third-party points of sale in the near future. • Fabrika also posted solid figures for FY15 as it continued to steadily grow its sales and expand its range of products. GB Auto’s pre-owned vehicles operation closed the year with LE 42.0 million in sales revenue compared to LE 22.0 million the year before. • The division’s gross profit margin also increased to come in at 20.9%, showing an improvement of 14.4 percentage points over FY14. • GB Auto’s Retail arm is in the process of rolling-out new After-Sales retail outlets that will be called ‘360,’ and will distribute tires, tire parts, batteries, parts and lubricants. These points of presence will also offer services including tire installation and balancing, battery services, and the sale and injection of lubricants in select locations. • Overall, new divisions contributed positively to the Group’s gross profits in 2015, and further contributions are expected from 2016 onwards.

Table 6: Other Sales Activity

Transport Business Revenues Lubricants Sales Revenue Pre-Owned Vehicles Sales Revenue Total Sales Revenues Transport Business Gross Profits Lubricants Gross Profit Pre-Owned Vehicles Gross Profit Total Gross Profit Gross Margin

4Q / FY 2015 Earnings Newsletter

(LE million) (LE million) (LE million) (LE million) (LE million) (LE million) (LE million) (LE million) (%)

4Q14

4Q15

% Change 4Q14 v 4Q15

FY14

FY15

% Change FY14 v FY15

0.7 1.5 9.3 11.6 -1.7 0.4 0.2 -1.1 -9.3%

0.8 18.7 13.4 32.9 -1.7 8.1 0.9 7.3 22.4%

6.0% 43.9% -1.3% 31.6

3.3 2.4 21.7 27.4 -6.7 0.6 1.0 -5.2 -18.9%

3.1 33.9 42.0 79.0 -6.9 13.5 2.4 9.0 11.3%

-5.5% 93.8% 1.7% 30.3

14

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Financial Position and Working Capital Management

As we enter 2016 with a replenished inventory, a solid pricing strategy, and a rather healthy market demand (despite natural inflation), we are in a better position to reap the benefits from our highgrowth markets.

4Q / FY 2015 Earnings Newsletter

GB Auto saw total sale revenues decrease by 23.0% and 0.5% y-o-y during 4Q and FY 2015, respectively, mainly as a result of the challenging FX environment in Egypt (especially towards the end of the year) as well as the turbulent Iraqi market (throughout the full year of 2015). In Egypt, the decrease in sales of the passenger car division were compensated by the Two- and ThreeWheeler division, the Commercial and Construction Vehicles division, as well as our Financing business. Despite the decrease in sales in 4Q15, our gross profit margins were quite strong y-o-y, as we reported GPMs of 15% in 4Q15 versus 11.8% in 4Q14 as a result of price increases the group introduced in the quarter. Full year profitability also improved as we closed the year at GPM of 13%. Overall, our operating profit decreased 30.5% y-o-y while our net profit showed a 34.4% increase compared to 2014, on the back of a one-time gain from the fair value reassessment of an investment property reported in 3Q15, as well as lower taxes paid due to a weak 4Q15 and an overall lower tax rate of 22.5%. The positive minority interest reported throughout the year is mainly due to the reported regional losses, especially in Iraq where low-oil-prices have taken their toll on the economic situation, in addition to the regional over-supply situation with spillovers mainly affecting Iraqi operations. On the cash front, the company has used most of its cash generated throughout the year (funds from operations in the first nine months of 2015 amounted to LE 622.5 million in addition to outstanding cash balances that stood at EGP2.2 billion at the end of 3Q15) to build inventory later in 4Q15, which will boost performance during 2016. We have now replenished most of our Passenger Car stocks, as well as Two- and Three-Wheelers and Commercial Vehicles, in a difficult FX environment. This is an operational hedge that we wouldn’t have achieved had we not had access to this excess liquidity by the end of 2015. As a result, the Group returned to a negative FFO front, albeit in a much better situation than at the end of 2014. The Group’s net debt stood at LE 4.0 billion, an increase of LE 1.2 billion compared to 3Q 2015, and LE 300 million above the final figure at the end of 2014. Net debt/equity dropped to 1.0x as at 31 December, 2015 from 1.3x at the end of 2014. Meanwhile, net debt/ EBITDA from continuing operations stood at 3.1x vs. 3.5x as at 31 December 2014. Total debt climbed to LE 5.2 billion at the end of 2015, and includes LE 1.3 billion of financing business debt, as we continue to expand and grow our operations. The figure also includes an FX exposure equivalent to LE 668.8 million. GB Auto is working to settle its FX debt promptly and has already taken steps to reduce it. As we enter 2016 with a replenished inventory, a solid pricing strategy, and a rather healthy market demand (despite natural inflation), we are in a better position to reap the benefits from our high-growth markets. We continue to operate a relatively lean company, with CAPEX for the full year standing at LE 290.3 million (compared to a depreciation expense of LE 255 million), leaving ample room for GB Auto’s planned expansion in the Tires business and the Two- and Three-Wheeler business, which we expect to report solid developments on very soon.

15

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Latest Corporate Developments 1) GB Auto adds Chery vehicles to its brand portfolio in tripartite cooperation agreement In October 2015, GB Auto entered into a tripartite cooperation agreement with Chery International of China and Aboul Fotouh Automotive (AF Automotive) of Egypt that will see GB Auto exclusively distribute Chery-brand vehicles through its nationwide network in Egypt. The agreement covers both CKD and CBU models produced by Chery International, including sub-compacts, compacts, sedans and small SUVs, all with engines in the 1.0L to 2.4L range.

2) GB Auto establishes new servicing facility in Alexandria In March 2016, GB Auto established its latest 3S facility in Amareya, Alexandria, to service its different passenger cars and commercial vehicle brands.

3) GB Auto awarded new tender for 150 buses GB Auto was awarded a new tender from the Egyptian Public Transport Authority to deliver 150 buses in 2016. Please refer to the Commercial Vehicles section of this report for more details.

4) GB Auto appoints Karim Gaddas as the new CEO for the Tires business

GB Auto’s After-Sales division performed well in 2015, boosting the contribution of the Passenger Cars, Motorcycles & ThreeWheelers, and Commercial Vehicles & Construction Equipment to the company’s overall profits.

4Q / FY 2015 Earnings Newsletter

In October 2015, GB Auto appointed Mr. Karim Gaddas as the Chief Executive Officer for its Tires business. Mr. Gaddas will lead the group’s effort in establishing a new tires manufacturing facility as well as manage the group’s current tires distribution business. Mr. Gaddas has over 20 years of experience in general management, operations, and sales and marketing activities having previously served in numerous positions at Pirelli, including headquarter-level roles in Milan, and regional roles in Paris, Dubai, Cairo and Alexandria.

Outlook The Egyptian economy rests on a number of pillars, including a swelling population figure, a key geographic position, and a basket of free-trade agreements, that GB Auto believes play a key role in supporting fundamental and long-term growth in the market. We continue to invest accordingly, despite a lack of short-term visibility imposed by the nation’s current foreign currency situation and procedural reforms. In that vein, management has successfully closed an LE 960 million capital increase to fund construction of two new facilities. The first will be a wholly-owned plant that will assemble motorcycles and three-wheelers, which management believes to be the first of its kind outside of India for Bajaj. The second will be a new tire-manufacturing facility to serve the MENA region’s growing tires market. The two new facilities will expand GB Auto’s opportunities in these fast-growing lines of business, in addition to enhancing Group profitability and FX outlook in the long-term (via exports). In addition to a continual focus on growth and investment in long-term opportunities, management has also stressed efficiency. The company is accustomed to operating in a lean, efficient manner in all aspects of the business — a trait that will serve us well as the country’s free trade agreements with the EU and Turkey on imports duties are fully implemented. These agreements have already placed Chinese and South Korean vehicles at a disadvantage, and management believes the full implementation of the two partnership agreements could have a substantial negative impact on the market. The government of Egypt appears to recognize 16

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

The two new facilities will expand GB Auto’s opportunities in these fastgrowing lines of business, in addition to enhancing Group profitability and FX outlook in the long run.

4Q / FY 2015 Earnings Newsletter

the difficult position into which automotive manufacturers and assemblers find themselves, and management continues to actively advocate for legislation that would protect domestic assemblers and the thousands of valuable manufacturing jobs they support. In the Passenger Car segment, management acknowledges downside risk to previous guidance arising from the current national foreign-exchange crunch and a lack of visibility as regards to the timeline on which this will be resolved. GB Auto will continue to prioritize a lean and efficient cost base, formulating pricing policies that will take judicious advantage of its pricing power to preserve margins for as long as possible. Downside risk could be mitigated by any move to prioritize foreign exchange for CKD kits as opposed to CBU units, given GB Auto’s position as a leading domestic assembler. Furthermore, the market still awaits the finalization of the Automotive Directive which aims to benefit local assemblers and thus improve our margin profile. On the Commercial Vehicles & Construction Equipment line of business, management does not expect significant growth of the tourism market until 2016. However, given the ongoing investment in infrastructure and renewed economic activity – such as the recent overhaul in public transport that saw the government purchase more than 400 new city buses – divisions in this key line of business are expected to continue their current growth trends for so long as state spending on infrastructure (including urban transport fleets) continues. As part of GB Auto’s ongoing drive for investment, the company intends to launch a pre-owned construction and heavy-truck distribution venture in the first half of 2016, propelled by the success of our pre-owned Passenger Car operation. In-line with management expectations, GB Auto’s After-Sales division performed well in 2015, boosting the contribution of the Passenger Cars, Motorcycles & ThreeWheelers, and Commercial Vehicles & Construction Equipment to the company’s overall profits. It is considered likely that After-Sales will turn in a particularly strong performance in 2016 as well, especially as the company roll-out new outlets in key, underserved geographic locations. Since the beginning of the year, we shifted payment terms for our Tires Business to an all-cash system. While this initially pressured our sales levels during the first quarter of the year, sales began to pick up again in the second quarter. In the second half of the year, however, problems with FX allocation began challenging the LOB once more. Meanwhile, our Financing business delivered a strong performance throughout the year and management expects this line of business to continue this trend, especially with company’s fifth financing venture, Tasaheel, posting promising results during its first months in operation. Turning our attention to the region, GB Auto continues to view measured risk as worthwhile and remains an investor in long-term growth, not immediate payoffs. Our operations in Algeria and Iraq should be viewed through that lens. In Algeria, GB Auto is convinced of the long-term potential of this market and has worked to align with Geely to get the right models at the right prices, set up an excellent management team and establish an effective dealer network. Furthermore, our representations in tires are very warmly received in Algeria. Going forward, management remains watchful of opportunities to deliver a product offering specifically tailored to the Algerian market. The Iraqi market, as expected and discussed in previous earnings releases, began 2015 on a challenging note as a result political and security developments. Although it remains possible that turmoil will remain a feature of the Iraqi market for some time to come, private-sector actors who stay the course throughout the headwinds will be those ideally placed to capture the upswing when the market

17

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

begins to improve. Furthermore, as we weather this period, management continues to pursue a capital-light approach to in-market expansion that has already seen it roll out its motorcycle and three-wheeler offerings in Iraq, with the latter capturing the attention of Iraqi consumers and achieving promising results thus far. In Libya, the challenging security situation is seeing GB Auto liquidate its stocks as it prepares to exit the market. While all inventory still in Libya remains insured, it is possible management will record charges due receivables if it deems the same non-collectable. Finally, we note that guidance going forward remains subject to change in light of changing regional geopolitical and macroeconomic conditions as well as the ongoing foreign exchange challenge in Egypt.

4Q / FY 2015 Earnings Newsletter

18

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Financial Statements Income Statement Three Months Ended (LE million) Passenger Cars Revenues Motorcycles & Three-Wheelers Revenues Commercial Vehicles & Construction Equipment Revenues Tires Revenues Financing Businesses Revenues Other Revenues Total Sales Revenues Total Gross Profit Gross Profit Margin Selling and Marketing Administration Expenses Other Operating Income (Expenses) Operating Profit Operating Profit Margin (%) Net Provisions and Non-Operating FV of Investment Property EBIT EBIT Margin (%) Foreign Exchange Gains (Losses) Net Finance Cost Earnings Before Tax Income Taxes Net Profit Before Minority Interest Minority Interest Net Income Net Profit Margin (%)

4Q / FY 2015 Earnings Newsletter

Year Ended

4Q14

4Q15

% Change

FY14

FY15

% Change

2,303.6 546.7 265.5 107.0 257.2 11.6 3,491.5 413.5 11.8% -117.1 -73.4 26.7 249.6 7.1% -14.2

1,498.8 485.9 286.8 90.5 294.4 32.9 2,689.3 409.3 15.2% -178.9 -69.7 8.9 169.6 6.3% -39.5

-34.9% -11.1% 8.0% -15.4% 14.5% 184.2% -23.0% -1.0% 3.4 52.7% -5.1% -66.7% -32.1% -0.8 178.4%

8,909.9 1,334.0 912.9 415.2 722.7 27.4 12,322.1 1,581.7 12.8% -439.6 -272.6 55.7 925.2 7.5% -67.8

-15.9% 49.7% 45.5% -21.9% 44.8% 188.6% -0.5% 0.8% 0.2 25.6% 26.1% -40.3% -20.9% -1.5 2.1%

235.4 6.7% -65.7 -99.5 70.2 -41.6 28.6 3.4 32.1 0.9%

130.1 4.8% -60.2 -83.8 -13.9 -4.2 -18.2 46.3 28.1 1.0%

-44.7% -1.9 -8.4% -15.7% -89.8% -12.3% 0.1

857.4 7.0% -157.1 -374.4 325.9 -90.2 235.7 -61.7 174.0 1.4%

7,489.9 1,997.2 1,327.9 324.4 1,046.2 79.0 12,264.7 1,594.4 13.0% -551.9 -343.7 33.3 732.0 6.0% -69.2 87.3 750.2 6.1% -175.4 -337.8 236.9 -45.4 191.5 41.6 233.1 1.9%

-12.5% -0.8 11.6% -9.8% -27.3% -49.7% -18.7% 34.0% 0.5

19

GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Balance Sheet As Of 31-Dec-14

31-Dec-15

% Change

Cash Net Accounts Receivable Inventory Assets Held For Sale Other Current Assets Total Current Assets

(LE million)

1,177.6 1,309.0 2,345.7 313.1 833.3 5,978.7

1,188.7 1,649.6 2,951.0 329.2 1,155.7 7,274.2

0.9% 26.0% 25.8% 5.1% 38.7% 21.7%

Net Fixed Assets Goodwill and Intangible Assets Lessor Assets Investment Property Other Long-Term Assets Total Long-Term Assets Total Assets

1,829.2 282.5 1,159.7 0.6 334.5 3,606.4 9,585.1

2,044.6 293.1 1,615.8 91.5 479.1 4,524.0 11,798.2

11.8% 3.8% 39.3% 43.2% 25.4% 23.1%

Short-Term Notes and Debt Accounts Payable Other Current Liabilities Total Current Liabilities

4,144.8 1,298.3 150.4 5,593.5

4,334.8 1,796.4 202.9 6,334.1

4.6% 38.4% 34.9% 13.2%

Long-Term Notes and Debt Other Long-Term Liabilities Total Long-Term Liabilities

680.9 536.8 1,217.7

898.5 622.5 1,521.0

32.0% 16.0% 24.9%

637.8

608.7

-4.6%

135.3 -3.3 267.3 1,066.8 670.0 2,136.1 9,585.1

1,094.0 -26.5 296.6 1,153.0 817.4 3,334.4 11,798.2

11.0% 8.1% 22.0% 56.1% 23.1%

Minority Interest Common Stock Shares Held With the Group Legal Reserve Other Reserves Retained Earnings (Losses) Total Shareholder’s Equity Total Liabilities and Shareholder’s Equity

4Q / FY 2015 Earnings Newsletter

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GB Auto (AUTO.CA) Earnings Release: 4Q / FY 2015

Head Office Cairo-Alex Desert Road, Km 28 Industrial Zone Abu Rawash, Giza, Egypt Investor Relations Menatalla Sadek, CFA Chief Investment Officer Hoda Yehia AVP - Corporate Finance Direct: +202 3910 0485 Tel: +202 3539 1201 Fax: +202 3539 0139 e-mail: [email protected] ir.ghabbourauto.com

Shareholder Information Reuters Code: AUTO.CA Bloomberg Code: AUTO.EY Shares Outstanding: 1,094,009,733

4Q / FY 2015 Earnings Newsletter

About GB Auto S.A.E. GB Auto S.A.E. (AUTO.CA on the Egyptian Exchange) is a leading automotive producer and distributor in the Middle East and North Africa. Across five primary lines of business — Passenger Cars, Motorcycles & Three-Wheelers, Commercial Vehicles & Construction Equipment, Tires and Financing — the company’s main business activities include assembly, manufacturing, sales and distribution, financing and after-sales services. GB Auto’s portfolio of brands includes Hyundai, Mazda, Geely Emgrand, Chery, Bajaj, Marcopolo, Iveco, Volvo Truck & Bus, Volvo Construction Equipment, Mitsubishi Fuso, YTO, Karry, SDLG, Aksa, Lassa, Yokohama, Goodyear, Westlake, Triangle, Grandstone, Diamond Back, Diamond Coin, Jumbo, Monroe and Gazpromneft. GB Auto has operations in Egypt, Iraq, Libya and Algeria, and is actively pursuing opportunities in new geographies within its core footprint. The company is headquartered in Giza, Greater Cairo Area, Egypt. www.ghabbourauto.com

Forward-Looking Statements This document may contain certain “forward-looking statements” relating to the Company’s business. These may be identified in part through the use of forwardlooking terminology such as “will,” “planned,” “expectations” and “forecast” as well as similar explanations or qualifiers and by discussions of strategy, plans or intentions. These statements may include descriptions of investments planned or currently under consideration or development by the Company and the anticipated impact of these investments. Any such statements reflect the current views of the Company with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors could cause the actual results, performance, decisions or achievements of the Company to be materially different from any future results that may be expressed or implied by such forward-looking statements.

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