Senaat posts AED 946 mn in profit for H1

Senaat announced a 6 percent increase in net profit in H1

Image for illustrative purpose only. A broker looks at a screen in the Dubai Financial Market December 23, 2009.

Image for illustrative purpose only. A broker looks at a screen in the Dubai Financial Market December 23, 2009.

REUTERS/Ahmed Jadallah
ABU DHABI, 22nd August, 2016 (WAM) – Senaat, a leading industrial investment holding company in the UAE, has announced a 6 percent increase in net profit and 2 percent increase in EBITDA for the first half of this year despite a challenging business environment, compared to the second half of 2015.

After a challenging 2015, the group’s EBITDA remained steady at AED946 million (US$257.54 million) for H1 2016 (H2 2015: AED932 million ($253.7 million) and net profit grew to AED341 million ($92.8 million) (H2 2015: AED321 million).

Additionally, the group’s revenues in H1 2016 were AED6.4 billion ($1.74 billion) in line with management expectations (H2 2015: AED7.3 billion ($1.99 billion), it said.

A challenging business environment, both in the UAE and globally, affected the group’s revenues, including pressures linked to the impact of oil prices, downturn in the global steel industry with overcapacity driving down prices, and a general retrenchment in core economic activity in Abu Dhabi and the UAE, a company press statement said.

In spite of these adverse fundamentals, Senaat achieved solid financial results driven by the strong performance of its portfolio companies, prudent financial management including rationalisation of costs and its sound corporate strategy. In comparison to the six months ended June 30, 2015 Senaat’s profit was slightly down and the margin decreased by 1 per cent, it added.

Jasim Al Nowais, chairman of Senaat, said, "In spite of the challenges faced both domestically and globally, our company remains confident in its financial position." "The strong performance of our portfolio companies, as well our senior management’s strategy of implementing internal cost controls have enabled us to remain in a strong position as we enter the second half of the year," he added.

"Looking ahead, we will continue to pursue opportunities to optimise its portfolio, maximise value for its shareholder and share wealth with citizens of the nation. This includes realising and re-investing profits, and growing its existing portfolio and creating new industrial leaders. We look forward to what the second half of the year will bring for Senaat as we work to achieve these goals," he said in conclusion.

Senaat’s portfolio companies reported strong earnings for H1 2016. Amongst the portfolio are two companies that are publicly listed on the local stock exchange.

ADX-listed food and beverages company Agthia Group was a standout performer, reporting a 16 per cent increase in net profit to AED145 million ($39.4 million) for H1 2016.

Arkan Building Materials PJSC, also listed on ADX, demonstrated resilient performance in an oversupplied market and recorded a commercial performance below last year due to a weather-related incident that had a negative, but limited impact on operations at one of the company’s cement plants.

H1 2016 also saw the progression of major projects for the group, including the April 2016 ground-breaking of the Al Gharbia Pipe Company plant, a joint venture between Senaat and Japanese partners JFE Steel Corporation and Marubeni-Itochu Steel Inc.

The facility will be the first sour service capable, welded steel pipe plant in the UAE, and will have expected production capacity of 240,000 tonnes annually, it added.

© Copyright Emirates News Agency (WAM) 2016.

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