Orascom Investment Holding 2024 Results: Small loss, big headline over North Korea cash
Orascom Investment Holding S.A.E. (OIH) published its IFRS consolidated results for the year to 31 December 2024. The group reported a net loss of US$ 6.836 million, a marked improvement on 2023’s US$ 39.302 million loss, with revenue edging up as the entertainment operations at the Pyramids continued to scale.
The eye-catching line is cash parked in North Korea: US$ 113.909 million on deposit at year end. Because repatriation is uncertain under sanctions, OIH keeps a 50% expected credit loss (ECL) against it, leaving a net carrying amount of US$ 56.954 million in “financial assets at amortised cost”.
Headline numbers investors should know
| Metric (US$ ‘000) | 2024 | 2023 |
|---|---|---|
| Revenue | 7,873 | 5,754 |
| Adjusted EBITDA | (21,131) | (59,133) |
| Operating loss | (22,216) | (60,760) |
| Net loss | (6,836) | (39,302) |
| EPS – basic & diluted (US$) | (0.001) | (0.0093) |
| Cash & cash equivalents | 45,714 | 73,583 |
| Cash held in North Korea (gross) | 113,909 | 95,911 |
| ECL on NK cash | (56,955) | (47,946) |
| Financial assets at FVTPL | 28,522 | 24,332 |
| Total borrowings | 107,890 | 103,395 |
| Total equity | 54,357 | 66,614 |
FVTPL means “fair value through profit or loss” – movements go straight into the income statement.
North Korea cash and loans – what’s really going on
OIH held US$ 113.909 million of cash in North Korea at year end, all subject to sanctions-related transfer restrictions. Management has continued to apply a 50% ECL (US$ 56.955 million in 2024; cumulative US$ 56.954 million carried), reflecting uncertainty over repatriation. Classification moved to current in 2024 after some onshore uses.
Separately, the North Korean associate (Koryolink) extended interest-free shareholder loans. The balance recognised as a borrowing at OIH was US$ 90.499 million at 31 December 2024 (non-current). Because the loan is interest-free, OIH booked a non-cash finance income of US$ 13.630 million from discounting it to present value. Sensible accounting, but it flatters finance income without bringing in cash.
Why it matters: the gross cash pile looks large, yet half is reserved via ECL and sits in a sanctioned jurisdiction, while a chunky related-party loan sits on the liability side. The net economic benefit to shareholders hinges on future sanction dynamics and repayment terms agreed with Koryolink.
Operations: entertainment steady, corporate drag persists
Revenue rose to US$ 7.873 million, all in Egypt, driven by Pyramids-based activities. Segment detail:
- Entertainment: revenue US$ 6.245 million; adjusted EBITDA US$ 1.288 million (profitable but modest).
- Other: revenue US$ 1.628 million; adjusted EBITDA US$ (22.419) million (group-level costs, impairments and financials sit here).
Adjusted EBITDA improved sharply year-on-year to US$ (21.131) million from US$ (59.133) million, helped by lower personnel costs (US$ 6.446 million vs US$ 9.081 million) and a reduced impairment charge on financial assets (US$ 14.000 million vs US$ 49.448 million).
Non-cash movers and market assets
- Lighthouse Energy Fund (Level 3): fair value gain of US$ 5.943 million lifted the portfolio to US$ 28.522 million. Level 3 means valuations rely on unobservable inputs; expect volatility as assumptions shift.
- Koryolink equity-accounted results: OIH’s share of profit was US$ 8.868 million, fully impaired in the same amount due to collection uncertainty – no net P&L impact.
- FX translation: US$ 6.021 million hit to OCI from currency movements; the translation reserve closed at US$ (89.255) million.
Bottom line: a good year for mark-to-model gains, but little that you can spend.
Cash flow, liquidity and debt
Operating cash flow was negative at US$ (33.650) million, with sizeable working capital outflows. Investing used US$ (21.126) million (notably US$ 11.182 million for financial assets and US$ 5.731 million capex). Financing provided US$ 27.833 million as the group drew US$ 34.854 million of new facilities.
- Year-end cash: US$ 45.714 million (down from US$ 73.583 million).
- Total borrowings: US$ 107.890 million, comprising:
- Loan from North Korea (Koryolink): US$ 90.499 million (non-current).
- Bank loans (Egypt): US$ 8.585 million.
- Finance lease liabilities: US$ 8.806 million.
Trade payables and other liabilities fell to US$ 4.903 million from US$ 15.593 million, easing short-term pressure. Capital commitments stood at US$ 10.573 million, largely linked to Pyramids site developments.
Receivables and impairments worth watching
- Trade receivables include US$ 14.079 million due from the Lebanese government and US$ 7.602 million due from telephone operators (historic balances). Total allowance on trade receivables is US$ 18.029 million.
- Cash in a Lebanese bank (US$ 1.3 million) was fully impaired due to the ongoing financial crisis.
Prudent provisioning is sensible, but it keeps reported profits under pressure until recoveries materialise.
Balance sheet snapshot
Total assets were US$ 183.442 million and total equity US$ 54.357 million at year end. Property and equipment decreased to US$ 22.632 million after deprecation and FX effects. Equity attributable to shareholders was US$ 54.444 million; non-controlling interests were US$ (87) thousand.
What could move the share price next
- Sanctions pathway and any demonstrable ability to repatriate North Korea cash – even partial movement would be material.
- Clarity on repayment or settlement terms of the interest-free Koryolink loans.
- Momentum at the Pyramids entertainment projects – revenue growth and margins from OPE/OSL.
- Valuation shifts in the Lighthouse Energy fund (Level 3) – a source of gains or reversals.
- Resolution of Lebanese receivables.
- Subsequent events flagged by OIH:
- A board-approved treasury share programme (June 2025) – potential support for the share price if executed.
- New medium-term financing for OSL signed in July 2025 to fund sound-and-light and a new exhibition area at the Pyramids and Sphinx.
My take: improvement, but the equity story still hinges on ring‑fenced cash
OIH’s 2024 P&L is cleaner than last year: smaller loss, fewer impairment shocks, and a profitable entertainment segment. That is positive. However, the investment case is still dominated by the North Korea position – both the stranded cash and the shareholder loan – alongside Level 3 valuations and government-related receivables.
If you are a patient investor, the upside scenario is obvious: any credible path to unlocking cash or settling balances at favourable terms could transform the balance sheet. Until then, cash burn from operations and reliance on borrowings temper the appeal. For me, this remains a high-uncertainty, event-driven story where position sizing should reflect the binary nature of those catalysts.
Quick glossary
- Adjusted EBITDA: profit before interest, tax, depreciation, amortisation and certain non-cash items – used to gauge operating performance.
- FVTPL: financial assets “at fair value through profit or loss” – gains/losses flow into the income statement.
- ECL: expected credit loss – IFRS model for recognising likely future losses on financial assets.
