Shuaa Capital reports strong underlying profitability for Q1

Shuaa Capital on Thursday posted Dh6 million net profit in first quarter compared to Dh25 million in the similar quarter last year.

In a statement, the leading asset management and investment banking platform in the region said net profit of Shuaa and its subsidiaries would have been increased at Dh37 million if the group excluded the effects of the intangible asset write-down.

It further said that earnings before interest, taxes, depreciation, and amortisation (EBITDA) generated of Dh83 million, up from Dh75 million in Q1 2021 and up from EBITDA of negative Dh18 million in Q4 2021. The result reflects a continued strong performance of the group’s core revenues, it added.

Jassim Alseddiqi, group chief executive officer of Shuaa Capital, said the business has successfully managed through the significant headwinds since the start of the year.

“The headwinds include war in Ukraine and the associated geopolitical uncertainties, accelerated inflationary pressures and commodity price increases along with heightened market uncertainty and volatility. The strengths of our business model are the high degree of diversification and our ability to adapt quickly and take advantage of market opportunities whilst continuing to build on increasing our recurring revenues and strengthening our balance sheet,” he said.

“Against this backdrop, we acquired another vessels company within the Thalassa fund, launched Shuaa Venture Partners and successfully raised a $100 million SPAC during the quarter, demonstrating our ability to effectually execute in a challenging environment,” he said.

In 2021, the group closed its non-core unit and transferred its residual assets to principal investments to be managed together with the other assets within the group. During the quarter, the group continued to proactively seek to wind down these items with a number of smaller disposals either completed, in progress or in the pipeline.

The group’s leverage ratio continues to decline with adjusted debt Dh212 million lower than twelve months ago. Reported debt to equity ratio declined by a net 22 per cent points to 112 per cent during the quarter which makes it the lowest ratio since 2019.

“While the group continues to operate against a backdrop of global geopolitical uncertainty and heightened market volatility, management remains focused on delivering performance in its core business and identifying new opportunities for the group. This will allow Shuaa to build on its market-leading position and deliver significant value creation for its investors and its shareholders,” according to the statement.

— business@khaleejtimes.com