QEWS’ revenue in 4Q 2022 jumps 29% YoY to beat our estimate by 15%
QEWS reported revenue of QAR 790.7mn in 4Q 2022, reflecting an increase of 29% YoY. In our opinion, the consolidation of Nebras has partially aided in boosting the top line during the quarter, which came in 15% above our estimate.
A faster rise in G&A expense constraints operating profit growth
Supported by healthy top-line growth and an improvement in efficiency at the gross level, gross profit grew at a faster rate (vs. revenue), beating our estimate by 39%. However, the beat at the operating level was slightly lower (+25% variation; +11% YoY) as the G&A expense rose sharply, exceeding our forecast by more than 70%.
Share of profit from JV & associates surges; boosts net profit
QEWS’ share of profit of joint ventures (JV) & associates more than tripled YoY to ~QAR 280mn during the quarter (our estimate: c. QAR 132mn). This largely boosted the company’s bottom line by 58% YoY to QAR 460.8mn, beating our estimate of QAR 198.4mn by a wide margin.
Maintain target price
The company has posted much better than expected results, and we remain optimistic about its prospects with Nebras actively pursuing overseas business expansion. Hence, we maintain our QAR 19.90 target price on the stock.