The best we can say about 2009 is that we are happy it is behind us. But every crisis offers an opportunity, at Raya; we took advantage of the business slowdown by channeling management time towards reflecting on the strategic direction of our company. In line with our corporate diversification strategy, we have restructured our operations into core and related non - core activities. The core activities revolve around our primary lines of business serving the ICT industry and focused around Raya IT, Raya Trade, Raya Call Center and Raya Smart Buildings, while non-core activities revolve around underserved industries where we spot opportunities for potentially profitable ventures.

In 2009, we partnered with Regiona l Investments Holdings LTD to establish a land transport company, Ostool, with an issued capital of EGP 20 mn. Moreover, we have approved an EGP 70 mn investment in Bariq factory, the first “Bottle to Bottle” Factory in Egypt, which will process post consumer plastic bottles into food grade PET pellets targeting the local as well as the export market. These investments in non-core ventures are a living testimony of our diversification strategy. Despite our best efforts, our operations have been affected by reduced market liquidity and lower sales due to slower economic growth over the past year. As a result, our total net sales fell by 14.1% from EGP 2.17 bn in 2008 to EGP 1.86 bn in 2009.

Despite the best efforts of Raya’s entire workforce, we closed this challenging year with net income lower by 22.9% year-on-year

Our unwavering confidence in the ability of our management team to creatively respond to both these market factors remains as strong as ever. They have addressed liquidity concerns through improved cash and debt management. They were able to significantly reduce our working capital, improve our cash conversion cycle and hence decrease our banking interests. They have managed to mitigate lower sales in our traditional business lines, where consumer and IT electronics took the hardest blows, through bringing new revenue lines on stream. It is noteworthy that our foray into the Green Smart Buildings segment over the past few years has made a positive contribution to the top line for the first time in 2009.

Recognizing the substantial financial resources at our disposal and largely untapped creative potential in our 2500 workforce and, we are determined to put our money where our minds are! To allow the creative energies of our staff to flourish, we are embracing an innovation initiative in 2010. Going forward, we plan to put innovation, both at the personal and corporate level, at the core of our strategic thinking through retaining and nurturing talented individuals. An early result of which has been the change in the business model at Raya IT from a technology provider to a business solutions provider. We are eyeing several opportunities ranging from automation needs of government entities to wireless digital communications licenses to offering off-shoring services to US and European companies looking for cost reductions in a harsher economic climate. As regional economies slowly recover from the past year’s severe economic downturn, we are optimistic that our diversification and innovation efforts along with our trust in the ability of our teams to deliver outstanding performance will be reflected in improved financial results in 2010.