MANAMA: SICO has reported consolidated net profit for the first quarter of 2021 of BD1.2 million, an increase of 168 per cent, reversing the net loss of BD1.8m posted in the first quarter of 2020.
Earnings per share (EPS) for the first quarter were 3.23 fils compared to 4.86 fils in the first quarter of 2020.
Total comprehensive income for the quarter increased by 144pc to BD1.4m compared to comprehensive loss of BD3.3m recorded in the first quarter of 2020.
Total equity increased by 9pc to BD63.4m as of end-March 2021, net of BD2.14m in cash dividends for FY2020 distributed during the first quarter of 2021.
Total shareholders’ equity was BD58.3m as of end-2020.
The increase in overall equity is primarily attributed to SICO’s sale of treasury shares through the share swap-based acquisition of Muscat Capital transaction and the addition of a new shareholder (Bank Muscat) in the first quarter of 2021.
Total assets at the close of Q1-2021 were BD221.6m, up by 22pc from BD181.8m at end-2020.
During the quarter, the acquisition of a majority stake in Muscat Capital in Saudi Arabia was completed.
Consequently, SICO consolidated the assets and liabilities of Muscat Capital on a line-by-line basis including off-balance sheet items, therefore driving the increase in total assets.
Meanwhile, Muscat Capital’s income statement and financial performance will be consolidated beginning the second quarter of 2021.
The growth in assets was also driven by an increase in securities bought under repurchase agreements.
Business lines performance in the quarter was supported by improved business conditions and markets’ upward trajectory, as SICO saw year-on-year increase in net investment income of 157pc, net fee income of 4pc, and net interest income increase of 8pc.
On the other hand, lower regional fixed income trading activities compared to the first quarter of 2020 resulted in a 10pc decline in income from brokerage and others.
Total assets under management (AUMs) increased by around 50pc to BD1.315 billion in the first quarter of 2021, from BD877.9m as of end-2020.
The increase was driven by a 9pc growth in AUMs during the quarter, as well as the consolidation of the AUMs of Muscat Capital.
Assets under custody with the bank’s wholly owned subsidiary, SICO Funds Services Company (SFS), remained unchanged at BD3m from the year-end 2020 level.
Commenting on the first quarter performance, chairman Shaikh Abdulla bin Khalifa Al Khalifa said: “SICO’s board of directors is pleased with the bank’s results this quarter, which reflect the ability to capture new opportunities and meet clients’ investment needs amid a steady market recovery.
Additionally, we are proud to have delivered on a key milestone in SICO’s future growth strategy through the successful acquisition of Riyadh-based Muscat Capital. The company will operate as SICO Capital and will see us further expand our capabilities and products beyond Bahrain and across the GCC.”
SICO chief executive Najla Al Shirawi said: “SICO has steadily continued delivering growth and profitability despite a resurgent pandemic, testament to the strength of our businesses and the resilience of our operations. Our signature equity and fixed income funds have continued to outperform their market indices
and generate positive returns for our investors, while SICO’s AUMs continued to grow organically. This comes on the back of robust performance and a diverse range of investment strategies and products that cater to investors’ unique objectives. Investment banking and brokerage trading has both expanded their client base through winning new mandates, which will yield positive growth in their income streams later in the year. We are confident that our strong performance across all business lines coupled with our new Saudi subsidiary leave us well poised to continue capturing new market opportunities and generate value for all our stakeholders for years to come.”
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