DFM posts net profit of Dh139.6m in H1

Dubai Financial Market on Monday announced its financial results for the first half of the year ending June 30, 2016, recording a net profit of Dh139.6 million, compared to Dh200m during the corresponding period of 2015, a 30 per cent decrease.

The net profit of the second quarter of 2016 reached Dh53.5m, a 60 per cent decrease compared to Q2- 2015 level of Dh132.4m.

The company recorded a total revenue of Dh227m in H1-2016 compared to Dh292.6m during H1- 2015. The revenue comprised of Dh184.8m of operating income and Dh42.2m of investment returns. The Company expenses reached Dh92.7m compared to Dh92.5m recorded during H1-2015.

During the second quarter of 2016, the Company’s revenue reached Dh100m compared to Dh178.1m in the second quarter of 2015, whilst expenses amounted at Dh46.5m in the same period compared to Dh45.7m during Q2- 2015.

The DFM trading value declined 32.7 per cent to Dh69.5 billion during the first six months of this year compared to Dh103.4bn in the corresponding period of last year. Trading commissions represent the main revenue stream of the DFM Company.

Essa Kazim, Chairman of Dubai Financial Market said: "The slowdown in trading activity during the first half of 2016 has overshadowed the revenue and profit of the DFM Company. Meanwhile, the market has demonstrated a high level of resiliency considering the unfavorable circumstances of lower oil prices as well as international markets’ volatility.

The DFM General Index has been one of the best performing amongst leading indices globally advancing more than 5 per cent during the first half. Additionally, foreign investors (Excluding Arabs and GCC Nationals) have increased their participation on the market from 16 per cent during the first half of 2015 to 17 per cent during the same period of 2016 and they were net buyers of Dh1.4bn, a 53.6 per cent increase, which clearly underlines their growing confidence in the market."

Commenting on DFM’s drive to build a new headquarter in the Business Bay, Essa Kazim said, "Preparations are underway to outline necessary plans for the implementation including engaging project managers and advisors. We are looking for front-line premises that serves the objectives of DFM and its participants including; brokerage firms, financial services’ advisors, custodians and other service providers. We are emphasizing on building a smart and sustainable headquarter in line with our "Smart Borse" strategy and the leading position of Dubai as a global financial hub."

The DFM has received a cost-free plot of land exceeding 10 thousands square meters with approximate value of Dh231m from Dubai Properties in order to build the new headquarter.

Highlighting some of the first half’s milestones, Essa Kazim said, "The DFM maintained its development efforts aimed at enhancing market infrastructure and regulations as per international practices. Within this context, DFM has launched the "Direct Deals Service" to streamline bulk deals on shares of a listed company within a fair and transparent environment while exempted from the price cap in effect (15 per cent up and 10 per cent down). Furthermore, DFM’s efforts to provide investors with new financial instruments have gain momentum as the market recorded Dh527m of trading in Rights Issues of three listed companies, which clearly indicates investors’ momentous interest towards this new tool."

He added that the market also welcomed the listing of Afkar Capital’s Exchange-Traded Fund (ETF) end of June in a first of its kind step. This development reinforces DFM’s strategy of innovation and diversification and provides investors with an alternative investment tool to access some of the leading listed companies in the UAE."

During the first half of this year, DFM has successfully accomplished the Cash Dividend Distribution for the financial year 2015 for the fifth consecutive year. And Dh10.5bn of cash dividend has been disseminated to 223,000 investors. The number of listed companies that have outsourced the dividend distribution process to DFM increased from 13 companies during the previous year to 26 companies this year.

In addition to this, the DFM organised its International Investor Roadshow in London last May as part of its constant efforts to further strengthen links between listed companies and international investors. The roadshow has achieved outstanding success as international institutions expressed its plans to further strengthen their presence in Dubai’s capital market amidst growing confidence towards the national economy’s outlook and ability to maintain high growth as well as its great resilience in adapting with global developments due to its enormously diversified structure that includes various dynamic and highly growing sectors.

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