Results of the Ordinary and Extra Ordinary General Assembly Meeting

Aamal Company QSC (“Aamal”), one of the GCC’s fastest growing diversified companies, today held its General Assembly Ordinary and Extra-ordinary meeting after achieving the required quorum. 

Sheikh Faisal Bin Qassim Al Thani, Chairman of Aamal Company Q.S.C. welcomed the attendees and then the AGM commenced according to the Agenda

1. Hearing Board of Directors report on the Company’s activities, financial position for the financial year ended December 31, 2015, and its business plan for 2016. Board of Directors report presented and approved

On behalf of the Board of Directors, I am pleased to present the Annual Report of Aamal Company QSC for the year ended 31 December 2015.

Aamal has delivered an exceptional performance in 2015. Revenue has grown by almost 35% which, when combined with an expansion in the underlying margin, has led to an almost 50% rise in net profit, excluding fair value gains on investment properties.

Beyond what is without doubt an excellent set of numbers, is a clear strategy that has allowed us to achieve sustained growth by optimising existing business operations and create new revenue streams. These results demonstrate clearly the resilience of our business model - diversified not just to minimise risk but also positioned to take advantage of structural growth opportunities. This bodes very well for the Company’s future prosperity.

Financial Highlights

• Group revenue up 34.7% to QAR 2,882.0m (2014: QAR 2,139.1m)
• Gross profit up 26.9% to QAR 642.1m (2014: QAR 506.0m)
• Net profit before fair value gains on investment properties (“underlying profit”) increased 49.6% to QAR 521.3m (2014: QAR 348.5m)
• Fair value gains on investment properties of QAR 135.4m (2014: QAR 251.7m)
• Total net profit¹ increased 9.4% to QAR 656.7m (2014: QAR 600.2m)
• Reported earnings per share increased 4.1% to QAR 0.95 (2014: QAR 0.92²)
• Gross capital expenditure rose by 22.1% to QAR 113.4m (2014: QAR 92.9m), reflecting the purchase of a sea-faring bulk carrier for a new Aamal subsidiary and commencement of Phase 2 of the redevelopment of the City Center Doha shopping mall
• Financial gearing³ reduced to 3.8% (31 December 2014: 4.5%)

¹ After fair value gains on investment properties but before the deduction of non-controlling interests

² In March 2015, Aamal issued and capitalised bonus shares so FY 2014 EPS has been adjusted accordingly (Company share capital increased to QAR 6.3bn from QAR 6.0bn)

³ Net debt to net debt plus equity

Aamal holds leading market positions in all these sectors, which along with exposure to the wider Qatari economy provided diversification, gives us the flexibility to respond quickly to evolving market needs and remain at the forefront of Qatar’s continued development.

Our recent decision to expand into the maritime transportation sector through the establishment of a new subsidiary, Aamal for Maritime Transportation Services, is an excellent example of how Aamal continues to look for and create new revenue streams. It is this progressive approach to growth, along with improving the performance of our existing businesses (for example the commencement of the second redevelopment phase of City Center Doha shopping mall), that helps to form the Company’s DNA and which underpins our strong momentum.

Senior management at Aamal are continually assessing and evaluation potential new investment opportunities that will create shareholder value, and it is only after rigorous analysis that a green light decision will be taken. This includes feasibility studies that are currently being conducted for a number of investment projects, whose outcomes will be announced only in the event of any decision to proceed. Accordingly, the Board of Directors has recommended that the net profits generated for the year 2015 be retained in order to provide sufficient liquidity and reduce leverage.

Aamal continues to comply with the highest transparency and disclosure guidelines, in accordance with the requirements of the regulatory and supervisory bodies, and adhering to best corporate governance and management practices. As part of best practice, we conduct periodic reviews of our policies and procedures; and accordingly, submit proposed changes to the Articles of Association of the Company to be discussed at the Extraordinary General Assembly Meeting.

Looking ahead, Qatar provides an investment environment that is becoming increasingly unique in the region, offering an attractive combination of political and social stability, sustained high levels of government infrastructure, a growing population and rising levels of urbanisation. These factors are presenting significant structural opportunities that Aamal is very well positioned to take advantage, and which will help to serve the future growth and development of the Company.

Finally, I would like to extend my sincere thanks to His Highness Sheikh Tamim bin Hamad Al Thani, Emir of the State of Qatar, may God protect him, and the government of the State of Qatar for their continued support and encouragement of the private sector and their belief in the vital role it plays in achieving a strong and balanced economy.

We would also like to extend our thanks and appreciation to our valued shareholders and partners for their trust and support in us as well as to our employees for their efforts. We ask God Almighty that he gives us the ability to continue to work in the best interests of us all.

H.E. Sheikh Mohamed Bin Faisal Bin Qassim Al Thani, Vice Chairman of Aamal Company. QSC, also presented his report: "In 2015, Aamal Company achieved excellent financial results across the organisation. Our innovative approach to business, in terms of first mover advantage, combined with a strategy of diversification has helped the Company to achieve sustainable growth and maintain its leading market positions.

Our utmost priority is firmly focused on value creation for our shareholders. Looking beyond the excellent set of results, driven by a combination of revenue growth and margin expansion, I am pleased to see the increasing contribution of the Industrial Manufacturing division which now accounts for a 59% share of total revenue and 23% of net profits (compared to 51% and 13% respectively in 2014). This is in line with our strategy, to focus primarily on industrial manufacturing and related high growth sectors in order to capitalise on the significant demand that is arising from the wider industrialisation of the Qatari economy.

Aamal has continued to grow and indeed prosper in line with its growth strategy. We occupy a number of market leading positions in a range of sectors across Qatar’s economy that are in various stages of structural, rather than cyclical, growth; furthermore, we are very well capitalised and have the financial strength to continue to pursue suitable opportunities as and when they arise. Recent commencement of Phase 2 of the redevelopment of City Center Doha to consolidate its status as Doha’s premier shopping mall is prime evidence of this.

Although there is clearly a strong emphasis on growth, this most certainly is not at the expense of our existing operations. We continually focus on their operational excellence by seeking additional efficiencies, including streamlining costs and investing in productivity, in order to maintain our industry leading cost positions and margins, whilst maximising our cash flows.

As Qatar moves towards achieving a knowledge-based economy under the wise leadership of H.H. the Emir, Sheikh Tamim Bin Hamad Al Thani, may God bless and protect him, the country enjoys a strong competitive advantage in the region. With the highest GDP per capita in the world, the lowest tax profile worldwide, a resilient economy and a successful on-going diversification strategy, it is steadily consolidating its position as the most competitive economy in the region and we are very fortunate to be operating in this market. We will continue to seek to take advantage of the growth opportunities enabled by these factors and help develop our beloved country.

Although the Aamal story is underpinned by the Qatar National Vision 2030, this is supplemented by the dedication and vision of the Company’s board of directors, its executive leadership and its employees.  I would like to extend my gratitude and appreciation for their efforts to strive continually for the best results possible.

 

*Before fair value gains on investment properties and deduction of Head Office Costs

Managing Director Mr. Tarek M. El Sayed presented his report

"Since the foundation of Aamal Company and its listing on Qatar Stock Exchange in 2007, the story has been one of steady evolution and progress. 2015 has seen this momentum being sustained, with a significant rise in underlying profits. What is extremely pleasing and heartening is that this has been achieved through a very healthy combination of strong revenue growth of almost 35% and margin expansion, matched by an equally impressive cash flow. Furthermore, Aamal is very lowly geared financially, at just 3.8%, which positions the business to grow further in line with its diversified strategy, through both organic and acquisition means, should suitable targets become available.

Our plan is to deliver attractive, balanced and sustainable returns over the medium-to-long term, and we have every reason to believe this is achievable. Possessing a strong balance sheet, a high degree of operational flexibility and occupying leading market positions across a range of high quality areas, it is our aim to optimise performance and deliver superior returns, while ensuring that such growth is sustainable for the medium to long term which will be to the benefit all our stakeholders.

To highlight a number of examples, in 2015: 

• Began Phase 2 of the redevelopment of the City Center shopping mall, which will not only increase the overall retail capacity available to let but also enhance overall operational efficiency levels once completed;
• Capitalised on our long standing relationship with German retail mall and shopping centre operator ECE Projektmanagement, establishing Aamal-EEC to meet the growing demand for comprehensive property management of shopping centres both in Qatar and potentially across the wider MENA region;
• Established a new JV ("Aamal Maritime Transportation Services") to take ownership of sea-faring vessels, initially to transport aggregates and other basic industrial raw materials but also potentially non-industrial commodities too, such as grains. The operational management of AMTS’s vessels is undertaken by Peter Döhle Group, one of the world’s leading providers of international shipping services, under a fixed term rolling service agreement.  This JV currently owns two vessels with capacity over 57,000 tons each;
• Increased production capacity at Doha Cables (from 40,000 to 52,000 tonnes per annum) and commenced production of high voltage cables in response to growing market demands triggered by extensive infrastructure development projects; and
• Initiated commercial activity at the Advanced Pipes and Casts Company which supplies its products to multiple infrastructure projects.

Aamal's established growth track record is framed by its ability to identify opportunities ahead of others and then manoeuvring swiftly to exploit them whilst maintaining a strong commitment to financial and operational progress and supported by a clear corporate vision and strong management team who steer the Company towards achieving its set goals. Aamal is in a strong position to seek new opportunities that are in line with its growth strategy, whilst setting ambitious targets to improve overall efficiency levels and consolidate its market leading positions in the sectors in which it operates. 

Looking ahead, we are committed to creating value for all our stakeholders through advancing our proven diversification strategy that has a primary focus on industrial manufacturing, and which positions us to operate profitably and sustainably. Currently we have several projects under evaluation which will be announced if we decided to proceed.

Finally, I want to thank all of our employees and our partners for the vital role they play in fulfilling the mission of Aamal for the benefit of the organization, its shareholders, and the Country under the wise leadership of HH the Emir, Sheikh Tamim Bin Hamad Al Thani, may God protect him.

2. Hearing and discussing the External Auditor’s report on the Company’s Financial Statements for the year ended December 31, 2015.

The External Auditors report presented and approved

3. Discussing and approving the Company’s Financial Statements, profits and loss for the financial year ended December 31, 2015.

 Financial Statement presented and approved

4. Discussing the proposal of the Board of Directors to carry forward the profits generated in the year 2015 to the year 2016.

Board of Directors proposal presented and approved

5. Absolving Members of the Board of Directors from their directorship responsibilities for the financial year ended December 31, 2015.

The Assembly absolved members of the Board of Directors from their directorship responsibilities for the financial year ended December 31, 2015

6. Discussing the Company’s Corporate Governance Report.

Corporate Governance Report presented and approved

7. Appointing the External Auditors for the Financial Year 2016, and determine its fees.

KPMG was appointed as the Company’s external auditors for the financial year

8. Electing members of the Board of Directors for a term of three (3) years starting from April 18, 2016 and ending on April 17, 2019.

The Board of Directors members were appointed by default. Only six (6) applications were submitted for candidacy for the Board of Directors membership and as the Board consists of only six (6) members.

 

Resolutions issued at the Extra-Ordinary General Assembly Meeting:

1-Discuss the proposal of the Board of Directors- presented at the Board of Directors Meeting on February 15, 2016 to amend the Articles of Association of the Company in order to comply with the Companies’ Law No. 11 of the year 2015.

The proposal of the Board of Directors to amend the Articles of Association of the Company in order to comply with the Companies’ Law No. 11 of the year 2015, was presented and approved at the Extra-ordinary general assembly meeting.

2-In the case that the aforementioned proposal is approved at the Extra-Ordinary General Assembly Meeting, the Assembly will delegate the Chairman or whoever he delegates to complete the procedures required for printing , authenticating and publishing the amended Articles of Association, after acquiring the required approval(s) of the Companies Inspection Department at the Ministry of Economy and Commerce.     

Extra-Ordinary General Assembly approved the above proposal and delegated the Chairman or whoever he delegates to complete the procedures required for printing, authenticating and publishing the amended Articles of Association, after acquiring the required approval(s) of the Companies Inspection Department at the Ministry of Economy and Commerce.     

Further enquiries:

Aamal Company	+ 974 4435 0666
Arwa Goussous, Corporate Communications Manager (mobile # +974 5513 9539)	[email protected]

Overview of Aamal

Aamal Company is one of the GCC’s fastest growing diversified conglomerates, with a market capitalisation at 14 April 2016 of QAR 8.3 bn (US$ 2.2 bn), delivering a compound annual growth rate in net profit before fair value gains on investment properties in excess of 20% from 2006-2015 and generating revenues of QAR 2.9 bn (US$ 791.4 m) in 2015. 

Aamal is one of the largest diversified companies quoted on the Qatar Stock Exchange (“QSE”), having been listed since December 2007, and is a constituent member of the QE Index which is a measure of the 20 largest and most liquid stocks listed on the exchange.

Focused on sustained, profitable growth and strongly diversified for balanced exposure across Qatar’s rapidly growing economy, Aamal’s operations comprise 24 business units with market leading positions in the key industrial, retail, property, managed services and medical equipment and pharmaceutical sectors.