DFM posts rise in full-year profit as trading value climbs

The value of shares traded on the exchange in 2020 increased 24% to Dh66bn

The DFM Company posted a 14 per cent increase in net profit of Dh137.9 million in 2020. Reuters

Dubai Financial Market Company, the operator of the DFM, reported a 14 per cent rise in its full-year profit boosted by higher trading activity.

Net profit attributable to owners of the company for the year ended December 31 rose to Dh137.9 million, up from Dh120.6m in 2019, the company said in a filing to the DFM on Wednesday. Total annual revenue increased 7 per cent year-on-year to Dh337.2m.

In what was a volatile year for equities markets worldwide, the value of shares traded on the exchange increased by nearly a quarter last year to Dh66 billion. The exchange also attracted more investors to the market.

"The high level of resiliency as well as the positive indicators of 2020 demonstrated by DFM underline the deep confidence of various market participants including investors, issuers, brokers, etc," Essa Kazim, chairman of the company, said. “Despite the pandemic, 2020 witnessed a significant number of achievements for the DFM, as the global crisis didn’t halt the implementation of strategic development plans."

The exchange attracted 2,350 new international investors, lifting total number of new investors in 2020 to 4,027. International investors accounted for 50 per cent of traded value with net purchases of Dh661m and a shareholding of 19 per cent of total market capitalisation by the end of 2020.

The DFM General Index limited its decline to 9.9 per cent by the end of the year, and in the year to the market's close on Tuesday was trading 9.3 per cent higher.

The company's fourth-quarter net profit fell to Dh17.8m compared to Dh25.1m in the last quarter of 2019, it said.

Quarterly revenue declined to Dh66.2m compared Dh74.2m in the same period a year earlier.

Last month, Dubai revamped the requirements to list local joint stock companies on the emirate's bourses.

All non-local joint stock companies are required to list their shares on the DFM and Nasdaq Dubai if they generate more than half of their annual profits or revenues from activities in Dubai.

These companies are also required to list if their total assets in the emirate amount to 50 per cent or more of their entire assets.