Beneficiary mass: a timid evolution expected in 2022

Beneficiary mass: a timid evolution expected in 2022

The profit base of companies listed on the Casablanca Stock Exchange should record an annual increase of only 3.5% in 2022, which almost corresponds to the achievements recorded in 2019.

30.49 billion dirhams, this is the level of the profit mass of companies listed on the Casablanca Stock Exchange, planned for the year 2022. According to the forecasts of market players(1), it should ensure an annual increase of only 3.5%, thus showing the same level as in 2019.

Growth sectors
In any case, several sectors will drive growth in 2022, in particular the mining sector which will benefit from a positive price effect. Thus, the increase in profits in this sector is mainly due to the surge in the prices of almost all the metals produced by the three mining companies listed on the Casablanca Stock Exchange and, to a lesser extent, to the rise in power mines acquired by Managem and newly in operation, such as that of TRI-K in Guinea.

The banking sector will also have a positive effect on the profit base. The recovery in the level of profitability of the sector is confirmed, in line with the continued gradual normalization of the cost of risk, favored by the economic rebound observed from 2021 and the continuation of efforts to ease health restrictions in 2022.

The improvement in margin levels in Maroc Telecom’s African subsidiaries will also have a positive effect on the profit base, which should more than offset the slight deterioration in the group’s margins in Morocco.

Note also the ramp-up of Marsa Maroc’s new transhipment activity, launched in 2021 in the TC3 terminal of the Tanger Med II port. The operator should benefit from the increase in cereal imports (following the poor domestic agricultural campaign) and an increase in hydrocarbon imports. For the tourism sector, Risma should take advantage in 2022 of the reopening of borders from February and the easing of health restrictions to improve its occupancy rate and, de facto, its margin levels as well as its profitability.

Sectors impacted
Other sectors are expected to show a decline in profit mass in 2022, and in the first place, that of the food industry. The profitability of consumer staples companies is also expected to suffer from higher input prices.

As a result, margin rates should contract, linked to the inability of companies to instantly and fully pass on the rise in input prices to consumers for fear of losing market share in a context of heightened competition, with easily substitutable products.

Furthermore, the automobile distribution sector should continue to suffer from the effects of the ongoing semiconductor crisis, which will have a negative effect on supply. For its part, the increase in the price of hydrocarbons should tighten margins in the energy sector. Indeed, the profitability of this sector should decline due to a deterioration in the margins of hydrocarbon distributors, such as TotalEnergies Morocco. In question, the increase in the price of hydrocarbons internationally and the decision of distributors not to fully pass on this increase in order to preserve their sales volumes.

Why this slowdown?
The noticeable slowdown observed is due to several factors linked to the national economic environment, the Kingdom importing almost all the products covering its energy needs. Thus, the surge in hydrocarbon prices (combined with inflationary pressures on all inputs and capital goods imported by Morocco), should have a negative impact on household purchasing power, internal consumption and corporate profitability. in 2022.

Beyond the harmful effects of imported inflation, Morocco has suffered this season from a very poor agricultural campaign due to drought. Thus, according to the latest forecasts from Bank-Al Maghrib, economic growth should slow down and stand at around 1% in 2022, a level well below its trend rate of 3.5%.

Inflation should rise to 5.3%, against an average of 1.1% observed over the past 10 years.

Sanae Raqui / ECO Inspirations

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