Eshraq Investments on Monday announced that its net profit climbed to Dh589.79 million last year compared to Dh38.43 million in 2021 as the company registered a remarkable performance.
The Abu Dhabi Securities Exchange (ADX)-listed company said its total investment income reached Dh546.44 million while net income hit Dh46.09 million last year mainly due to gain resulting from the acquisition of Goldilocks and the increase in the performance of the investments forming part of Goldilocks.
“We are thrilled to announce exceptional growth in profitability and significant strides towards solid revenue growth in fiscal year 2022. Our outstanding performance is a reflection of our sound financial practices, robust strategy, and adaptability in the face of changing market conditions,” Jassim Alseddiqi, Eshraq's chairman, said.
Additionally, he said our land monetisation programme is already having a positive impact on Eshraq's profitability, and the company is excited about the opportunities it holds for the future.
“Above all, we remain steadfast in our mission to drive growth and enhance value for our shareholders through our long-term strategy,” he said.
Eshraq Investments is an investment Company based in Abu Dhabi, UAE, with assets of more than Dh3 billion in real estate, public equities, fixed income, private equity and debt products
The board of directors recommended to pay a cash dividend of two fils per share. The dividend recommendation will be presented to the shareholders for approval at the company’s upcoming general assembly meeting.
The board also approved the appointment of a liquidity provider for the company’s shares listed on ADX and authorised the board’s executive committee to execute the appointment.
“We are diligently working to enhance shareholder returns, and in this regard, we have taken a number of initiatives in this meeting. We have proposed a cash dividend of two fils per share to be approved by shareholders in the AGM, and agreed to continue the share buyback programme,” Alseddiqi said.
“We have also approved appointment of a liquidity provider. We are confident that these efforts will help us strengthen our shareholder base and improve the long-term investor appetite,” he said.
In line with the board's commitment to enhance shareholder returns, Eshraq repurchased an additional 37 million shares for a total value of Dh18.56 million as of January 31, 2023. The share buyback has resulted in a gain to shareholders of Dh26.1 million on account of share buyback at discount to Eshraq’s book value.
The board agreed to continue the share buyback program to achieve the target of buying back 84.6 million shares (three per cent of capital) in its first year of buyback programme that started in August 2022.
Highest-ever annual net income
The company reported its highest-ever annual net income of Dh589.79 million, a 27-fold jump year-over-year. This was primarily due to the gain of Dh436.58 million to Eshraq shareholders on account of the acquisition of Goldilocks Fund and subsequent increase in performance of Goldilocks’ investments on Eshraq’s balance sheet, leading to gain of Dh564.97 million as of December 31, 2022.
Eshraq achieved a total operating income of Dh570.68 million for 2022 versus a total operating income of Dh67.34 million for 2021. The increase in operating income resulted from the increase in operational revenue and gains in the investment portfolio.
Land monetisation programme
Eshraq has also made rapid progress on monetizing its land bank and so far signed sales and purchase agreements of seven plots representing 28 per cent of its existing land bank by book value with total sale consideration of Dh208 million. The sales further improve the liquidity and focus on profit generating financial assets, along with recurring revenues from the company’s leasing and hospitality businesses. The sale of the land plots at a competitive valuation underscores the company's potential to monetise the land bank via transactions that are accretive to Eshraq’s shareholders.
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