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21 February 2024

UAE firms 2nd best GCC performers

By Nadim Kawach

The net profits of UAE companies listed on its two stock exchanges are projected to have jumped by nearly 33 per cent in 2008 to turn the country into the second best stock performer in the region, according to a bank survey.

Qatar topped the list in the six-nation Gulf Co-operation Council and other Mena nations, with a forecast growth of a staggering 63-per cent in the net income of its listed companies, showed the survey by NCB Capital, an affiliate of the Saudi National Commercial Bank (NCB).

"The full-year 2008 estimates depict an average 16.4 per cent growth in net incomes for companies in the GCC and Egypt," the report said. "All GCC countries are expected to end the year with moderate to strong earnings growth, while Egypt may witness decline in full year revenues."

A breakdown showed Oman ranked third, with the net earnings of its listed companies projected to surge by 21 per cent in 2008. NCB forecast a profit growth of nine per cent for Bahraini firms, five per cent for those in Saudi Arabia and around four per cent for listed companies in Kuwait.

Company-wise, the report showed NCB is expected to be the top performer in the GCC, with an estimated profit rise of 275 per cent over 2007.

It was followed by the Saudi Hollandi Bank, with a projected growth of 196 per cent, and Arabtec Holding, with around 141 per cent.

Profit growth was put at 121 per cent for Industries Qatar, 108 per cent for Saudi Arabia's Safco, 102 per cent for Almazaya Holding, 89 per cent for Qatar Gas Transport Company, and around 80 per cent for Al Jazeera Airways.

The best 15 gainers in the GCC's seven bourses also included Sorouh Real Estate, with a projected profit growth of around 75 per cent and the Abu Dhabi National Energy Company (Taqa), with around 73 per cent.

Growth was forecast at nearly 63 per cent for Dubai Investments, 55 per cent for Qatar National Bank and 54 per cent for the UAE's First Gulf Bank.

A list of 15 firms which are expected to record large decline in profits included Saudi Arabia's Yanbu National Petrochemicals, Saudi Electricity, Dubai Financial Market, National Real Estate Co, Commercial Bank, Saudi Investment, Gulf Cement Company, Orascom Telecom Holding, Sixth of October Dev and Inv, Kuwait and Gulf Link, Refrigeration Ind, Gulf Pharma, Al Khalij Commercial Bank, Emirates International Telecom and Salhiah Real Estate.

The report included another list of the most attractive companies in the GCC and Egypt given their lowest price to earnings ratios (P/E)

Tamweel topped with the list with a P/E of one per cent, followed by Arabtic Holding with a ratio of 1.2 per cent and Dubai Investments with 1.3 per cent. The list also included Emaar Properties, Aldar Properties, Amlak Finance, Dubai Islamic Bank, Taqa, Aerated Concrete, Union National Bank, Export Dew Bank of Egypt, Emirates NBD, Al Mazaya, Injazat Real Estate and Sorouh.

In terms of market capitalisation at the end of 2008, the Saudi Arabian Basic Industries Company was the dominant company, with a capitalisation of $44.4bn. Saudi Telecom, the Saudi Al Rajhi Bank and the UAE's etisalat came second, third and fourth respectively.

According to official figures, 692 companies with a combined market capitalisation of around $606bn were listed on the GCC's seven bourses in the UAE, Saudi Arabia, Kuwait, Qatar, Bahrain and Oman at the end of 2008. Egypt had 379 companies with a capitalisation of nearly $84bn.