Shuaa's profits triple in fourth quarter as revenues rise

Net profit reached Dh73m in the fourth quarter compared to Dh22m during the third quarter of 2019

Shuaa Capital increased assets under management to $14bn by the end of 2019. Jaime Puebla / The National

Dubai investment bank Shuaa Capital’s profits more than tripled in the fourth quarter over the third quarter due to higher revenues.

Net profit attributable to the shareholders for the period ending December 31 reached Dh73 million compared to Dh22m during the third quarter of 2019, the company said in a statement on Thursday.

The investment bank did not provide year-on-year figures for its profitability. Revenues during the period jumped 63 per cent to Dh146m, driven by a number of significant transactions that closed in the final quarter.

Group Ebitda for the quarter amounted to Dh134m compared with Dh63m in the third quarter of 2019. For the full year, the company reported a profit of Dh45m.

“2019 was a milestone year for the group. In the context of challenging regional and international market conditions and geopolitical uncertainty, we executed on a transformational merger, which significantly strengthened the path to value, both for our clients and our shareholders,” said Jassim Alseddiqi, group chief executive of Shuaa capital.

“We achieved a profitable year, increased our AuM (Assets under Management), invested in our people and our platform, expanded our product and distribution capabilities, and strengthened our governance and controls - all whilst concluding a merger in record time, which is already delivering synergies.”

Shuaa Capital merged with Abu Dhabi Financial Group last year, which created an enlarged business with both an asset management and investment banking platform, with diversified revenue streams across seven countries including the UAE, Saudi Arabia and the UK.

The company is currently focusing on growing and expanding its asset management and investment banking platform and is selling its non-core assets. It recently sold its brokerage arm, Shuaa Securities as well as its equity market-making business for Dh100m.

The group’s asset management business is maintaining its growth trajectory. A recent deal to manage $400m (Dh1.47 billion) portfolio of assets helped increase the total group assets under management to $14bn, up 15 per cent year-on-year.

During the past 12 months, the group has been mandated to lead over $500m in sukuk issues, including GFH Financial Group’s $300m five-year sukuk, Jabal Omar Development Company’s $135m five-year sukuk and The First Group’s $135m sukuk. It also played a strategic advisory role in several transactions, including the reverse listing of PAL Holding and IHC on the Abu Dhabi Securities Exchange.