09 May 2009
SHUAA Reports Negative Earnings of AED 197.9m for First Quarter 2009 with Positive Outlook
- First quarter net loss attributable to shareholders of AED197.9 million represents a 65.7 per cent improvement over fourth quarter 2008 net loss of AED577.4 million
- Results include AED42.8 million in negative income from associates, AED59.2 million in provisions for one of our associates, and AED68.5 million in book losses due to mark-to-market reductions
- Diluted earnings per share (EPS) were negative AED 0.248 for first quarter 2009 versus negative AED 0.724 as of 31 December 2008
- General & administrative expenses reduced by 31 per cent to AED73.1 million during first quarter 2009 (fourth quarter 2008: AED106 million)
- Balance sheet remains strong with AED 3.8 billion in total asset, AED 1.8 billion in liabilities and AED 2.0 billion in shareholder’s equity
- Liquidity remains strong with over AED 400 million in cash and deposits with banks while total liabilities were reduced by AED341.9 million during the first quarter
- Client’s funds under management only slightly lower at AED4.5 billion, down from AED4.7 billion last quarter
SHUAA Capital’s first quarter results reflect a significant improvement over the last quarter. Despite significant efforts to enhance profitability, through cost-cutting measures, and focus on growing our fee businesses, book losses from investments still overshadowed the overall results.
SHUAA’s fee generating businesses, which were profitable during the financial year 2008, but posted a net loss in the last quarter of 2008, recorded a net profit for the first quarter 2009.
Negative earnings attributable to shareholders were AED197.9 million during first quarter 2009. This improvement over the negative earnings of AED577.4 million during the fourth quarter 2008 was mainly due to lower book losses on risk positions that were either exited or have already been reflected in the income statement during the last two quarters.
Mr. Majid Al Ghurair, Chairman of SHUAA Capital, commented:
“SHUAA’s current performance reflects the particular challenges of our industry which cannot be compared to other listed companies in the UAE”. He continued: “We believe that we have made all the difficult decisions and have left the worst behind us. The continued market turmoil during the first quarter strained our results but there has been a significant improvement in market sentiment since the beginning of March, and we are positive on the rest of this year.”
Mr. Iyad Duwaji, Chief Executive Officer of SHUAA Capital, highlighted:
“We remain hard at work to return to profitability in 2009. Despite the recent headlines, the reality is that we remain committed to our clients and with over 400 professionals across the GCC region, they can count on us to help them navigate through these difficult times.“
He added: “We have increased our market share in our brokerage business in the UAE in 2009 where we now rank second, and we are seeing renewed investor interest which we hope will translate into fresh inflows later in the year.”
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About SHUAA Capital psc: Since 1979, SHUAA Capital has played a prominent role in shaping the financial services landscape of the GCC and will continue to be at the vanguard of regional integration into global financial markets. SHUAA Capital maintains leadership positions in Investment Banking, Asset Management, Brokerage, Private Equity and Lending. Headquartered in Dubai, in the United Arab Emirates, SHUAA Capital has a regional presence with offices in Abu Dhabi, Riyadh, and Doha. Embedded in the dynamic economic environment of the Gulf Cooperation Council, SHUAA Capital provides a broad range of financial services to corporations, governments, institutional clients, and high net worth individuals.
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