In line with its October 2012 forecast, SHUAA Capital has succeeded in reducing its net loss from Dh293.8 million in 2011 by 80 per cent to Dh59 million in the following year.
The improvement was achieved primarily by the completion of the company’s restructuring programme.
Total expenses for the year were reduced by Dh163.0 million. General and administrative expenses were down Dh37.7 million as the number of staff was reduced. The lending business recorded Dh13.7 million in expenses increase in line with its expansion plans in the UAE and Saudi Arabia.
All other business units recorded decreases of expenses totalling Dh51.4 million, a year-on-year improvement of 29 per cent.
During the first half of 2012, SHUAA incurred charges related to the company’s restructuring programme, which only started to have a positive impact on general and administrative expenses during the second half of 2012. The full impact of the 2012 restructuring programme is expected to be seen in 2013 with an additional cost improvement of 10 per cent.
Revenues for Q4 2012 were Dh25.2 million compared to Dh20.1 million for Q4 2011, an increase of 25 per cent and bringing 2012 annual revenues to a total of Dh137.3 million, a 38 per cent increase over 2011 revenues of Dh99.3 million. Revenues were buoyed by an increase in interest income and a positive swing in investments in SHUAA’s managed funds.
In the fourth quarter 2012, SHUAA’s net loss was cut to Dh20.7 million from a loss of Dh111.9 million in the same period last year.
As at 31 December 2012, SHUAA’s total assets stood at Dh1.4 billion. Cash and deposits rose 24 per cent to Dh423.3 million.
Throughout the year, the company continued to reduce liabilities by retiring debt. As a result, total liabilities fell by 38 per cent to Dh269.4 million from Dh437.2 million at the end of 2011, lowering interest expenses by 28 per cent to Dh11.7 million from Dh16.2 million in 2011.
Sheikh Maktoum Hasher Al Maktoum, executive chairman of SHUAA Capital, said: “Despite the volatile market environment in 2012, SHUAA’s financial results for the full year are in line with our market guidance. 2012 was a transformational year for SHUAA and the business achieved key milestones in its announced restructuring programme. We successfully completed four major turnaround initiatives, including the right-sizing programme, the reduction in non-core assets, the transformation of our balance sheet by strengthening our liquidity position and the announcement of an operational roadmap with a focus on recurring revenue generation.”
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