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Shuaa's first-quarter profit drops 10pc to Dh67 million

DUBAI - Shuaa Capital announced on Tuesday a decline of 10 per cent in year-on-year net profits. The first quarter net profits stood at Dh67.1 million against Dh74.5 million recorded last year. However, the company did record a 13.9 per cent rise in last quarter which recorded profits of Dh58.9 million.

For the first quarter ending 30 June 2008. The operating income reached Dh176.6 million against Dh107.7 million recorded in last quarter, indicating a rise of 64 per cent. The company's yearly operating income surged 21.9 per cent, which stood at Dh 144.9 million last year.

Iyad Duwaji, Chief Executive Officer of Shuaa Capital said "I am pleased with our overall performance given difficult market conditions regionally and globally. We remain confident that fiscal 2008 will be another successful year for Shuaa Capital. Although the performance during the first quarter partially reflected the poor performance and unusual volatility in capital markets, our annuity fee business generated the second strongest quarter in the company's history."

In comparison to the first quarter last year, Shuaa Capital's annuity fee business recorded significant growth of 73.1 per cent to Dh119.5 million against Dh69 million. Shuaa Asset Management contributed a substantial portion of this result. Reaching their highest level ever, assets under management of Shuaa Asset Management increased by 121.8 per cent year on year to Dh 6.7 billion (Q1 2007/08: Dh 3.0 billion), and grew 37.0 per cent over the last quarter (Q4 2007/08: Dh 4.9 billion).

Kerim Mitri, Deputy CEO of Shuaa Capital added: "Our diversified and balanced business model helped us maintain solid operating income growth and deliver a sizeable net profit. Shuaa's capital position is strong and we have deployed resources to invest in high-margin, high-profit businesses while we control our growth efficiently across regional markets. We also remain confident that the GCC will continue to serve as a safe haven for smart investors - both foreign and domestic."

Shuaa Capital's total client's funds under management increased by 110.6 per cent to Dh15.6 billion (30 June 2007: Dh 7.4 billion) year on year. This reflects the continued demand from regional and, increasingly, international investors for its products and services, primarily asset management, brokerage services, and private equity investments. In May 2008, Moody's Investor Service assigned a long-term issuer rating of Baa2 to Shuaa Capital with a stable outlook. The short-term issuer rating on Shuaa is Prime-3.