May 03 2012
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KAMCO Posts KD 6 Mln Net Loss In 2011; LPS 25.3 Fils
KUWAIT CITY, May 3:
KIPCO Asset Management Company ( KAMCO ) held the Annual General Meeting on Thursday afternoon, followed as per usual by its Shafafiya (Transparency) Forum. Present at the forum were Saadoun Abdullah Ali, Executive Manager; Entisar Abdul Raheem Al Suwaidi, Vice-Chairman; Shehab Wahid Khawaja, Deputy Executive Manager of Planning and Finance; Khaled Abdul Jabbar Al Sharad, First Deputy to Executive Manager of Human resources and Administration as well as representatives from the Ministry of Commerce and Industry and Ernst & Young.
In her address to shareholders, Entisar Al Suwaidi stated, "On behalf of KAMCO 's Board of Directors, I am pleased to announce that our company has successfully navigated through the various challenges in 2011 with the minimum realized loss, supported by our solid fundamentals, sustainable growth strategy, an embedded culture of risk management, and resilient business model. This year, KAMCO posted a Net Loss of KD 6.0 million or Loss per Share of (25.3) fils, compared to a Net Profit of KD 1.8 million in 2010, or 7.6 fils per share. Our total Assets under Management reached approximately KD 2.1 billion ($7.5 billion) as of December 2011, compared to KD 2.4 billion ($8.6 billion) for the year ending December 2010.
"Despite solid and operational assets, KAMCO 's investments were not spared from the sharp declines in most markets and asset classes. However the company managed to maintain positive cash flow throughout the year. Management & Advisory fees as a percentage of total revenue increased from 54% to 77%, which reflects a growing client base. Also, realized gain on sale of investments as a percentage of total revenue increased from 24% to 44%.
"In addition, KAMCO 's debt-to-equity ratio remains relatively low. Loans & Bonds have decreased from KD 71.25 million to KD 61.75 million, reducing the leverage ratio from 0.82 to 0.77, and we anticipate a faster recovery in our assets' values given their high quality. Moreover, throughout 2011, KAMCO was diligent in enhancing compliance and risk management according to industry best standards, focusing on capital preservation, managing market risk, and continued its consistent conservative investment strategy."
She continued, stating that despite the negative results posted, KAMCO 's diversified investment portfolio and steady operational income acted as buffers for the company's funds. KAMCO was also involved in numerous corporate finance mandates, as well as investing in corporate social responsibility and the community.
Al Suwaidi's report was followed by a presentation from Saadoun Abdullah Ali, in which he outlined KAMCO 's business, strategy and team, as well as providing a performance update of the past year. He pointed to the profits KAMCO earned for KD 40 million, despite peer losses totaling KD 500 million, and detailed the strategic approaches which have dictated their decisions to largely divest from property investments and focus on core activities.
He concluded by stating that " KAMCO hopes to continue with its efforts to restructure the company into a smaller and more focused entity concentrating on its core activities, and aims to identify and develop innovative investment products for its clients. KAMCO has been mandated on a number of new transactions in its investment banking activity and will build further on its past success in placing dept ad equity transactions with clients."
KAMCO 's Annual Review and Financial statements for 2011 were available to attendees in their Annual Report and the floor was open to shareholders for questions regarding the reviews and statements.
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