Waha Capital PJSC, a leading investment company based in Abu Dhabi (ADX: WAHA), has reported a net profit of Dhs152m for the first quarter of 2014 compared to Dhs85m in first quarter 2013, representing a 78% increase.
The continuous and accelerated growth in net profit was driven by income generated from Waha Capital’s portfolio of diversified investments, and was further supported by the proceeds from the sale of the company’s stake in AerLift during the first quarter.
The value of Waha Capital’s assets increased 4% to reach Dhs5.45bn, up from Dhs5.24bn as at 31 December 2013. Total shareholder equity increased to Dhs2.5bn in the first quarter of 2014, from Dhs2.4bn a year earlier. The quarterly results were announced following a Board meeting in Abu Dhabi chaired by His Excellency Hussain Jasim Al Nowais, Chairman of Waha Capital, and attended by Board members and representatives of the company’s executive management.
Al Nowais, said, “Waha Capital is delivering on its promise to maximise shareholder value, and deliver even higher return on equity. In only three months, the company has recorded the equivalent of half of last year’s full-year net profit. We are confident that the successful implementation of our diversified strategy will position the company as a key player in the global market.” He added, “We remain committed to prudently managing our investments and will pursue select investment opportunities in high potential sectors in order to continue to deliver strong returns to our shareholders.”
Salem Rashid Al Noaimi, CEO and Managing Director of Waha Capital, added, “It is particularly important to note that our profits are now being generated from across our investment portfolio. We have also created a robust risk-return profile to manage and grow the company’s assets. The increasing contribution of our capital markets division is also quite encouraging. We are well capitalised and in an excellent position for further expansion in areas with high growth potential, such as healthcare, education and other sectors where we see value.”
In April, Waha Capital announced that it had sold its 60.7% stake in AerLift Leasing, which owns a portfolio of 11 commercial aircraft operated by a number of international airlines, to a newly established United States-based aircraft leasing platform. The sale was agreed for a total consideration of Dhs307m. At the end of March, Waha Capital completed the refinancing of its credit facilities, with 13 local and international banks participating. The company obtained a five-year US$750m facility comprising a term loan for US$375m and a revolving loan for the same amount. This replaces a previous US$505m facility secured in 2011.
Investments perform strongly
New York-listed AerCap Holdings NV, in which Waha Capital owns a 26.2% stake, continued to produce robust returns. During the first quarter, AerCap purchased 3 aircraft, signed lease agreements for 15 aircraft and delivered 7 aircraft under contracted lease agreements. At the end of the quarter, its portfolio consisted of 377 aircraft that were either owned, managed or under contract to purchase.
AerCap is set to expand dramatically through the acquisition of ILFC from AIG, a transaction that is scheduled to close in the second quarter of the year and which is therefore yet to register on Waha Capital’s accounts. Waha Capital expects the transaction to deliver immediate shareholder value through dramatic increase in scale and an expected rise in Aercap’s earnings per share.
Dunia Finance, a UAE-based consumer finance company in which Waha Capital owns a 25% stake, continued to produce very strong results in the first quarter, with net profits up by 55% to Dhs41m. Dunia’s loan book grew 39% to Dhs1.1bn, up from Dhs804m in the same period in 2013. The company gained 6,209 new customers during the quarter and saw its deposits increase by 10% from the previous quarter. The capital markets division at Waha Capital continued to grow its contribution to the company’s profits. It has been increasing its exposure to global credit markets over the last two years, and is now beginning to successfully invest in regional equities.
The Anglo Arabian Healthcare Group performed well, already breaking even in the first quarter, less than a year after its acquisition by Waha Capital. The six clinics operated by the group saw a 10% increase in the number of patients treated during the quarter, while PHD Laboratories conducted 92% more tests than in the same period in 2013, generating over 80% more revenue than in the same period in 2013. The group continues to increase the number of doctors it employs. Expansion projects, which were started in the first quarter, will provide an additional 5 clinical and diagnostic facilities for the group.
Waha Capital continues to benefit from its stable investment in MENA Infrastructure Fund, a $300m private equity infrastructure fund with assets spread across Saudi Arabia, Oman, and Egypt. The Fund’s underlying assets continued to perform well in the first half of 2014 delivering positive results. Stanford Marine Group (SMG), which operates offshore supply vessels (OSVs) and in which Waha Capital holds a 49% stake, maintained stable profits in the quarter with its fleet of 39 vessels achieving an average utilisation rate of 93%.
Waha Capital’s industrial real estate development, ALMARKAZ, has seen strong leasing demand due to the project’s high-quality infrastructure, strategic location, flexibility and scale. As of the end of the first quarter, 68% of the 90,000 sq m of Small Industrial Units (SIUs) had been leased. ALMARKAZ is exploring a number of growth plans including the expansion of SIU space, and development of new products such as warehouses and light industrial units on the remaining 870,000 sq m of serviced land within Phase I of the development.
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