Half year financial results
Diversified growth strategy delivers strong growth in both revenues and underlying profits across all four divisions
Doha, [21] July 2010 – The Board of Directors of Aamal Company QSC (‘Aamal’), one of the GCC’s fastest growing diversified conglomerates, today announces the financial results for the half year ended 30 June 2010.
Financial Highlights
- Group revenue up 60.3% to QAR 566.9m (H1 2009: QAR 353.6m)
- Gross profit up 17.9% to QAR 178.8m (H1 2009: QAR 151.7m)
- Net profit (before fair value gains on investment properties) of QAR 109.6m was up 7.3% (H1 2009: QAR 102.1m)
- Net profit (after fair value gains on investment properties) of QAR 109.6m was down 34.7% H1 2009: QAR 167.8m) due to nil Fair Value adjustments (H1 2009: QAR 65.7m)
- Net margins (before fair value gains on investment properties) decreased to 19.3% (H1 2009: 28.9%) due to an acquisition and impact of upfront production costs at Doha Cables
- Low financial gearing* at 12.1% (31 December 2009: 9.2%)
- Reported** earnings per share down 40.5% to QAR 0.22 (H1 2009: QAR 0.37)
- Net investment in capital expenditure of QAR 98.9m (H1 2009: QAR 92.5m)
- Acquisition of 49% stake in El Sewedy Cables Qatar
* Net debt to net debt plus equity
** In April 2010, Aamal issued and capitalised bonus shares so H1 2009 EPS has been adjusted accordingly
Operational Highlights
- Strong trading performance across all four divisions reflect Aamal’s diversified strategy of investment in developing leading market positions
- Group Share Capital increased to QR 4.5 billion through a bonus issue (31 December 2009: QR 3.795 billion)
- Official launch of Aamal Cement Industries in January 2010
- Official launch of ECCO Gulf in February 2010, a business process outsourcing company, in partnership with ECCO Outsourcing of Egypt
- Official launch of Doha Cables in May 2010, in partnership with El Sewedy Electric of Egypt
- Recently acquired 49% of El Sewedy Cables Qatar through Aamal subsidiary Senyar Industries Qatar Holding, a 50:50 JV with El Sewedy Electric (agreement structured to take effect from 1 January 2010 for consolidated reporting purposes)
H.E. Sheikh Faisal Bin Qassim Al Thani, Chairman of Aamal Company QSC, commented:
“I am delighted to report another excellent set of results for Aamal Company, with a 60.3% increase in revenue and a 7.3% growth in net profit before fair value gains on investment properties. The first half of 2010 has been a busy time with the official openings of Doha Cables, Aamal Cement Industries and ECCO Gulf earlier in the year and I am pleased to say that each of these ventures has met or exceeded our original expectations. This is in line with our prudent strategy of focusing on the diversification of operations; this strategy has helped us to achieve the best results during difficult market conditions.
“I am particularly pleased to announce the acquisition of 49% of El Sewedy Cables Qatar through our subsidiary Senyar Industries, a joint partnership with El Sewedy Electric. El Sewedy Cables Qatar is a trader of electro-mechanical equipment and will naturally complement our strong market position in cables production through Doha Cables Qatar leading to a positive and material contribution to Aamal’s results.
“We will continue to focus on attracting first class partnerships to enhance and grow our operations and to assist the State of Qatar in achieving its vision of becoming an advanced and self-sustainable economy. As such, for the second half of the year, we are looking forward to announcing additional developments that we hope will provide positive contributions to our group in years to come whilst maintaining a clear focus on returns on capital and capital discipline coupled with prudent financial management of the cost base.”
DIVISIONAL REVIEW
All Figures in QARm and before deduction of Head Office costs
PROPERTY MANAGEMENT & DEVELOPMENT
Branches in this division comprise City Center Doha and Aamal Real Estate.
| QAR m | H1 2010 | H1 2009 | % |
|---|---|---|---|
| Revenue | 99.3 | 87.6 | 13.3 |
| Net Profit | 73.5 | 61.3 | 19.9 |
* before fair value gains on investment properties
TRADING & DISTRIBUTION
Branches in this division include Aamal Trading & Distribution, Ebn Sina Medical, Aamal Medical, Bottega Verde and Foot Care Centre.
| QAR m | H1 2010 | H1 2009 | % |
|---|---|---|---|
| Revenue | 226.3 | 182.1 | 24.3 |
| Net Profit | 31.0 | 26.4 | 17.4 |
INDUSTRIAL MANUFACTURING
Branches and subsidiaries in this division include Aamal Readymix, Senyar Industries Qatar Holding, Aamal Cement Industries, Doha Cables and Elsewedy Cables Qatar.
| QAR m | H1 2010 | H1 2009 | % |
|---|---|---|---|
| Revenue | 231.6 | 77.7 | 198.1 |
| Net Profit | 18.2 | 15.4 | 18.2 |
MANAGED SERVICES
Branches and subsidiaries in this division comprise Aamal Travel & Tourism, Aamal Services and most recently, in early 2010, ECCO Gulf was added.
| QAR m | H1 2010 | H1 2009 | % |
|---|---|---|---|
| Revenue | 17.8 | 12.8 | 39.1 |
| Net Profit | 4.4 | 3.7 | 18.9 |
SUMMARY & OUTLOOK
On behalf of the Board I am delighted to report another excellent trading period for Aamal Company. We are particularly pleased that our underlying profits continue to grow while our new ventures during the period position us well to take full advantage of the extraordinary Qatar growth story.
We have now successfully increased our share capital to QR 4.5 billion through a capitalisation of retained earnings, placing us in a stronger position to expand further our operations, and establish well planned joint ventures in order to provide our shareholders with higher returns and minimal risk. In addition, the General Assembly has recently expanded and strengthened the Board with a number of new appointments to help ensure that all strategic decisions are carefully implemented and that Aamal Company maintains its leading position in the market and heads towards further prosperity and growth.
For the second half of the year, we expect the strong first half trading performance to continue due to the underlying strength of the Qatari economy coupled with identified growth opportunities in all our sectors and prudent financial management of the cost base. We will also continue to focus on creating first class partnerships to enhance and grow our operations whilst playing a vital role in the development of Qatar.
H.E. Faisal Bin Qassim Al Thani
Chairman
Further enquiries
| Aamal Company | |
| Arwa Goussous, Corporate Communications Manager | +974 513 9539 |
| Citigate Dewe Rogerson | |
| Seb Hoyle / Ged Brumby / Nick Cox-Johnson | +974 452 8335 |
| Ayman Hammamieh / Habib Bacha (for Arabic media) | +971 (0)2 401 2612 |
PLEASE NOTE: A video webcast of Aamal Company management presenting the 2010 Half Year Results is available for equity analysts and investors to download from the Investor Relations section of the Aamal Company website:
http://www.axisto.com/webcasting/investis/aamal/half-year-results-2010/register.htm
About Aamal Company QSC
Aamal Company QSC (‘Aamal’) is one of the GCC’s fastest growing diversified conglomerates, delivering a CAGR in net profit, excluding fair value gains, of 22% p.a. from 2006-2009 and generating revenues of QAR 705m (US$194m) in 2009. Focused on sustained, profitable growth and strongly diversified for balanced exposure across Qatar’s growing economy, Aamal’s operations comprise of over 16 business units with market leading positions in the key property management and development, industrial, retail, managed services, medical equipment and pharmaceutical sectors. Aamal is listed on the Qatar Exchange.
