Saudi operations help to grow Shuaa earnings
(11/7/2018 9:42:00 AM)
Dubai-headquartered investment house Shuaa Capital has posted its highest quarterly profit since 2008 as it continues to expand its operations in Saudi Arabia, UAE and Kuwait.
The company reported a 30.1 million dirham ($8.2 million) net profit for the third quarter this year, a 31 percent increase year-on-year, according to a filing on the Dubai stock exchange.
Year-to-date net profit stood at 56.4 million dirhams, slightly down on the 59.8 million dirhams recorded in the same period in 2017. The increased profit has been driven by growth in the company’s asset management arm which oversees the development of real estate projects in Saudi Arabia and the UAE. The division reported a 8.5 million dirham profit in the third quarter, a 35 percent increase on the previous year.
Shuaa expanded its presence in Saudi Arabia earlier this year, signing a preliminary deal with the Saudi real estate developer Jabal Omar Development Company to jointly manage real estate investment funds in the Kingdom.
Jabal Omar’s existing flagship development is in Makkah, just walking distance from the Grand Mosque. Set to be delivered in phases, the project will feature high-rise towers, luxury apartments, residential units and shopping malls.
The investment house also worked with the hotel management firm Rotana on the Centro Waha Riyadh hotel which opened in the Saudi capital city in October last year. The hospitality project was funded by the Shariah-compliant Shuaa Saudi Hospitality Fund I.
Kuwait is another target market for the firm, said Shuaa chief executive Fawad Tariq-Khan, in a DFM statement, saying the company will build on its acquisition of Amwal International Investment Company and its subsidiary Noor Capital Markets, which was first announced in July 2017. “Our recent acquisition of Amwal International Investment Company in Kuwait, and intended business affiliations are meant to help us benefit from synergies and capture inbound and outbound business prospects,” he said.
“Activating these investments and partnerships is imminent, and we expect the final quarter to be another game changing quarter for the group,” he said. This quarter’s results continue the growth seen in the second quarter where profits rose by 21 percent to reach 14.6 million dirhams.
However, Shuaa’s profits more than halved in the first quarter compared to 2017, a decline which Shuaa’s management partly blamed on lower interest income from its lending arm following a reduction in bank debt at its lending subsidiary, Gulf Finance Corporation.