SHUAA Capital Reports 1Q 2018 Results, Maintains Profitable Trajectory Amid Expansion Activities
SHUAA Capital today reveals its 1Q 2018 financial results, with the company keeping profitability. While Group overall revenues enhanced a little by 4% to work out at AED 33.2 million (Q1 2017: AED 31.8 million), revenues retreated to the AED 11.7 million mark (Q1 2017: AED 24.8 million) largely as an outcome of lower interest revenue from its loaning arm, as an outcome of hostile de-leveraging in bank financial obligation in SHUAA's loaning subsidiary Gulf Money Firm. Year-on-year bank debt has actually minimized by AED 159m to AED 87m today (Q1 2017: AED 246m) and with term debt due to be fully re-paid throughout Q2 2018, showing strong operating capital. Throughout the quarter, SHUAA had also bought expanding business, particularly its Capital Markets division including the broker agent existence in the UAE and Egypt.
The quarter saw SHUAA's Asset Management unit videotaping AED 8.9 million in incomes (Q1 2017: AED 5.7 million) a boost of 56%, with the division's revenues up 204% to reach AED 4.1 million (Q1 2017: AED 1.4 million). The system, which manages and recognizes the growth of prime real estate opportunities in both the Kingdom of Saudi Arabia and the United Arab Emirates, remains in the process of completing construction of a third project in Saudi Arabia in the city of Dammam. The department had actually likewise started construction services a new mixed-use domestic substance in Riyadh called 'Wadi Al Hada' worth around the SR 1.4 billion, with work with the AED 1.7 billion 'Dubawi' project adjacent to Sheikh Zayed roadway readied to commence soon.
The Investment Banking divisions earnings stood ground at AED 0.7 million (Q1 2017: AED 0.7 million) with a loss of AED 0.6 million (Q1 2017: loss AED 0.8 million) through. The department is currently servicing numerous regional buy and sell-side advisory requireds. The Resources Markets department, having gone through a period of growth to support the loan consolidation initiatives with the new full-fledged brokerage firm business in Egypt, the combination of the freshly acquired subsidiary 'Integrated Securities, total investments in innovation and human capital, and particularly, resources implementation to expanding the marketplace Making and Liquidity Provision services additionally, reported a rise in incomes to AED 5.1 million (Q1 2017: AED 4.2 million). The division videotaped a loss of AED 1.7 million (Q1 2017: loss AED 1.0 million). SHUAA continues to be the largest and most active Market Maker and Liquidity Stipulation company in the UAE, actively collaborating with the 3 local exchanges, with strategies to roll out this specific niche solution across regional markets soon. The Credit division, making up Gulf Financing Corporation UAE and its Shari'ah certified funding sibling company Gulf Finance Saudi Arabia, continued to be rewarding at AED 2.2 million (Q1 2017: 8.7 million).
The corporate division which is the main business line in charge of the Group's customer dealing with procedures, business development and major investments reported profits of AED 7.7 million (Q1 2017: AED 16.5 million). With the Group investing in growing its different groups consisting of investments in enhancing its regional Funding Markets' technological facilities to fit network growth from the UAE to Egypt and soon Kuwait, the Group's General and Administrative expenses boosted to AED 27.7 million (Q1 2017: AED 22.8 million).
Fawad Tariq-Khan, President of SHUAA Resources, said: The last 12 months has seen aggressive de-leveraging of our business with AED 159m bank term debt repaid from internally generated cash flows. Our core operations are welding well under the long-term strategy set last year and we are seeing positive results by expanding our portfolio of service offerings including our recent launch in Egypt for securities brokerage where SHUAA is now a top 15 broker. During Q2 we will also begin consolidating the operations of both Integrated Securities and Integrated Capital as well as other acquisitions in the pipeline that will allow SHUAA to continue its path towards sustainable profitability.
As of March 31, 2018, SHUAA's balance sheet and complete assets was AED 1.3 billion (2017: AED 1.2 billion). Internet assets stood at AED 869.2 million and the Group's liquidity placement was healthy with AED 94.1 million in money and cash equivalents. SHUAA's Bank Debt-to-equity ratio was up to just 10% (Q1 2017: 29%) offering utilize opportunities.
