Waha Capital, which counts Mubadala Investment Company among its shareholders, reported a 69 per cent increase in annual profit in 2021, driven by "strong returns" from its emerging markets credit and equity funds businesses, the investment management company said.
Profit attributable to the owners of the company for the year ending December 31 jumped to Dh391 million ($106m), from Dh231m in 2020, the company said in a filing to Abu Dhabi Securities Exchange, where its shares are traded. Revenue from the sale of goods and services rose to Dh301.9m in 2021, from Dh301.5m in 2020.
"Waha Capital delivered a strong financial performance in 2021 despite volatile markets and a challenging macroeconomic environment," said Waleed Al Muhairi, chairman of the company.
"The company is now well-positioned to build on the success of the past year so that it can generate long-term, sustainable value for its shareholders."
Waha Capital embarked on a turnaround strategy in 2019 to improve its performance and, despite increased volatility in global capital markets, all funds managed by the business continued to outperform their industry benchmarks, the company said.
The company's public markets business, which reached $1.2 billion of assets under management during 2021, recorded investment gains and fee income of Dh902m. Its net profit rose 88 per cent year-on-year to Dh603m.
"As a company, we successfully implemented a turnaround strategy and we are now focused on driving growth," said Ahmed Khalifa Al Mehairi, chief executive of the company. "Waha Capital’s public markets business has maintained its impressive track record since its inception in 2012, with our credit and equity funds consistently outperforming industry benchmarks."
Waha Capital's private investments business, which started carrying out a new multi-year strategy, recorded a net loss of Dh86m due to impairments and mark-to-market losses on certain legacy investments, it said. These were partially offset by gains on the divestment of a majority of the company’s US securities portfolio.
"In 2021, we also appointed a number of highly experienced investment professionals to rebuild our private investments business," Mr Al Mehairi said. "The team is now executing a multi-year mandate to deliver growth through the creation of new portfolios, while continuing the restructuring of our legacy assets to maximise value."
The company’s real estate subsidiary, Waha Land, which owns and manages an integrated mixed-use industrial development, maintained 95 per cent occupancy in 2021. The unit's net profit increased 52 per cent to Dh35m in 2021 from the previous year.
Waha Capital’s total assets under management stood at Dh5.84 bn as of December 31, 2021. The company's cost-to-income ratio for the year reached 25 per cent, which is 7 per cent lower than the previous year.
The company's board recommended a cash dividend of 7.55 fils per share and a transfer of 2.45 treasury shares to shareholders for every 100 shares owned, the company said.
Looking ahead, Waha Capital said its financial performance and strong balance sheet position it to develop on its strategy for further growth into 2022.
As the company moves into 2022, it will continue to invest across its businesses and navigate through "challenging global market conditions," it said.
"While the ongoing pandemic continues to impact market conditions, [given] the vaccination programmes, as well as containment programmes implemented by the authorities, expectations are that economies will start to navigate out to more normal business operations," it said.
Market conditions though will "continue to be volatile", with potential inflation, and increasing interest rates, it said.
"In 2022, Waha Capital’s objective is to ensure that both [private and public investment] businesses continue to accelerate the company’s growth," Mr Al Mehairi said. "By drawing on our extensive emerging markets expertise, strong business networks and robust governance practices, we can ensure that we deliver ... attractive returns."