SHUAA Capital today reports its preliminary and unaudited full year results for 2018. While total Group revenues increased by 23% to reach AED 165.2 million for the year, net profit fell 63% year-on-year to AED 27.2 million with the Company taking mark-to-market charges on its investments in in Q4 2018 and additional one-off provisions on legacy assets.
The fourth quarter brought about the biggest impact on earnings, reporting a loss of AED 29.2 million (2017: AED profit of AED 14.2 million), while revenues for the last quarter of 2018 rose 40% to AED 60.1 million, up from AED 42.8 million in the corresponding quarter of 2017.
Fawad Tariq-Khan, Chief Executive Officer of SHUAA Capital said, “During the year we continued executing our turnaround strategy and completed acquisitions of Integrated Securities, Integrated Capital and Amwal Investments, adding cash flow generative businesses that have significant cross-sell opportunities and allowing us to distribute our first dividend in ten years. We also re-leveraged our balance sheet with favorable debt terms once we had repaid our legacy loans providing the Group with ample liquidity coming into 2019. While our profitability for the year was impacted by challenging market conditions at the end of last year, our core operations continued to grow and position SHUAA for the future. We expect the fruits of our diversification campaigns to come through properly over the coming months as we continue to grow our presence across the region”.
Volatility persisting across regional markets especially during the second half of the year, held the Group back from achieving its previously set targets. Yet, the firm navigated the adverse market headwinds well, and continued to execute its long-term business diversification objectives, which entails rolling out products and services into new jurisdictions such as Kuwait, Turkey and Jordan.
As at December 31, 2018, SHUAA’s balance sheet and total assets were AED 2.1 billion (2017: AED 1.2 billion). The Group’s liquidity position was strong with AED 441.4 million in cash. Liabilities increased to AED 1.2 billion from AED 325.4 million in 2017.