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2017 Aug 14

Waha Capital reports AED 183.1 million net profit in H1 2017

ABU DHABI, August 14, 2017: Waha Capital PJSC, a leading investment company based in Abu Dhabi (ADX: WAHA), has reported a net profit of AED 183.1 million for the first half of 2017.

The asset management division continued to deliver healthy returns, with income from capital markets rising 10 percent compared to H1 2016, while total income from private equity remained steady.  Assets held by the principal investments division also produced a healthy financial and operational performance.                           

The company recorded a second quarter net profit at AED 95.6 million, compared to AED 130 million a year earlier. The decrease was largely due to an adjustment of AED 66.6 million against the share of income from AerCap Holdings NV, following a conservative reassessment of the recoverable amount on the company’s stake in AerCap.

Waha Capital produced a return on average equity of 5.1 percent in the first half, while total assets increased 8 percent over six months to AED 10.8 billion as at the end of June 2017.

Salem Rashid Al Noaimi, Chief Executive Officer and Managing Director of Waha Capital, said:“Waha Capital continues to produce attractive returns from its diversified portfolio, and this is coming through clearly in the operating and financial results at the level of our investments. Our asset management division goes from strength to strength, with income from capital markets up nearly 10 percent in the first half, compared to H1 2016. It is important to note that our principal investments portfolio remains solid, with income only down because of an accounting treatment of our stake in AerCap, despite the company’s strong financial and operational performance this year. Waha Capital’s robust balance sheet, including a healthy cash position, means that we are well positioned to move ahead with our strategy to grow our asset management business, and to deploy additional capital through our principal investments division.”  

Within the asset management division, first half income from capital markets increased 10 percent year on year to AED 176.7 million in the first half, representing 32 percent of Waha Capital’s total income for the period. The private equity platform, which holds UAE healthcare provider Anglo Arabian Healthcare as an asset, reported total income of AED 163.2 million in the first half, which was flat on the previous year.

Waha Capital has invested significant seed capital in its funds, which are also currently being marketed to third-party investors. Assets under management totalled AED 1.8 billion as of June 30, 2017.

The Waha MENA Equity Fund produced a total return of 9.4 percent during the first half. The Waha MENA Value Fund, which invests in regional equities, has given a total return of 9.5 percent in the first six months of the year. Meanwhile, the Waha CEEMEA Fixed Income Fund produced a 9.6 percent total return in the period.

Meanwhile, total income from principal investments totalled AED 216.6 million in the first half, compared to AED 297.8 million a year earlier, due to an impact of AED 125.4 million on account of a conservative reassessment of the recoverable amount of AerCap shares.

AerCap reported strong second quarter results on August 3, with quarterly net profit rising 21.27 percent year on year to AED 1.04 billion. The company executed 213 aircraft transactions in the first half of this year and signed an agreement with Boeing for an order of 30 787-9 aircraft.  Being the world’s biggest aircraft leasing company, Aercap has a portfolio of 1,539 aircraft that were owned, on order or leased as of 30 June 2017.

The income contribution from NPS Holdings, in which Waha Capital has a 20.7 percent stake, continued to increase. The oil and gas services company recorded a 19.2 percent rise in revenues to AED 452.6 million in the first half of 2017. The company secured AED 138.5 million worth of contracts in the period, bringing the total value of current contracts to AED 2.09 billion.

Waha Land, a wholly owned company of Waha Capital, continued to make significant progress on the next phase in its growth, having arranged a AED 426 million financing package last year for further development of its ALMARKAZ light industrial real estate project. The company increased half year net profit by 13 percent to AED 12.9 million.  

The financial performance of consumer finance firm Dunia Group, in which Waha Capital holds a 25 percent stake, was impacted by a sector-wide slowdown. The firm has increased its customer base by 17 percent to 274,000 customers, but has taken a prudent approach to extending finance in the context of a slowing economy, reducing its loan portfolio by almost 5 percent over the last year to AED 1.9 billion. Consequently, net interest income for the first half decreased 12.6 percent to AED 254.5 million.

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