SHUAA CAPITAL E a r n i n g s P r e s e n t a t i o n
Q 3 2 0 2 2
11 November 2022
© 2022 SHUAA Capital psc. All rights reserved
Executive Summary
Financial Measures
Key Metrics
Group
Updates
- Net profit attributable to shareholders of AED 20 million in Q3 2022 compared to net loss of AED 170 million in Q2 2022 underpinned by strong revenues
- Third quarter net operating income excluding one-off items of AED 14 million compared to AED 6 million in Q2 2022 backed by strong recurring revenues across all segments while maintaining expense discipline across the Group
- Cost to income ratio at 77% in Q3 2022 significantly lower than the 90% in Q2 2022. Expanding operating margins for the business in Q3 2022 driven by lower costs
- Cost optimization initiatives are expected to continue with the cost-income ratio expected to meet management mid-term target of 65%
- Continued disciplined approach to deleveraging with debt-to-equity ratio at 124% in Q3 2022
- Balance sheet metrics expected to improve in Q4 2022 driven by higher profitability and further reduction in leverage
- Real Estate: Northacre recently announced project completion of The Broadway, a USD 1.5 billion contemporary residential and mixed-use development with unrivalled views across Westminster and St James's Park in London
- Public & Private Markets: recent addition of USD 220 million in new AuM to our Discretionary Portfolio Management and funds in the third quarter of 2022
2
Key Financial Highlights Q3 2022
Q3 2022 Financial Performance
% Change | % Change | |||||||
Income Statement (AED Mn) | Q3-22 | Q2-22 | vs. Q2-22 | Q3-21 | vs. Q3-21 | |||
Net Fee and Commission Revenue | 68.2 | 56.1 | 22% | 59.3 | 15% | |||
Other Revenue | (8.2) | 7.4 | (210%) | 12.4 | (166%) | |||
Total Revenues | 60.0 | 63.5 | (6%) | 71.7 | (16%) | |||
Operating Expenses (excl. one-off | (46.3) | (57.1) | 19% | (46.9) | 1% | |||
items and carry expense) | ||||||||
Net Operating Income (excl. one-off | 13.7 | 6.4 | 114% | 24.8 | - | |||
items and carry expense) | ||||||||
One-off items and Employee Carry | (6.5) | (39.0) | - | (1.0) | - | |||
Net Operating Income/(Loss) | 7.2 | (32.6) | 122% | 23.8 | - | |||
Other Income/(Expenses) | 110.8 | (25.3) | - | (4.4) | - | |||
Profit/(loss) from discontinued | (37.7) | (86.0) | - | 18.9 | - | |||
operations | ||||||||
Non-Controlling Interests | (60.3) | (26.0) | - | (3.7) | - | |||
Net Profit 1 | 19.9 | (169.9) | - | 34.7 | - | |||
EBITDA 2 | 91.9 | (49.1) | - | 50.5 | - | |||
Key Metrics | ||||||||
Operating Margin (%) excl. one-off | 23% | 10% | 13% | 35% | (12%) | |||
items and carry expense | ||||||||
CIR (%) | 77% | 90% | (13%) | 65% | 12% | |||
% Change | % Change | |||||||
Balance Sheet (AED Mn) | Q3-22 | Q4-21 | vs. Q4-21 | Q3-21 | vs. Q3-21 | |||
Total Assets | 3,766 | 5,768 | (35%) | 6,132 | (39%) | |||
Total Debt | 1,940 | 2,474 | 22% | 2,633 | 26% | |||
Total Equity | 1,566 | 1,846 | (15%) | 2,037 | (23%) | |||
Key Metrics | ||||||||
Debt to Equity | 1.24x | 1.34x | 10% | 1.29x | 5% | |||
Return on Equity | (14%) | 2% | (16%) | 9% | (23%) | |||
1 Net Profit attributable to shareholders
32 Excludes results for discontinued operations *excluding one-off items
Commentary
Net profit of AED 20 million underpinned by
strong revenues in Q3 2022
- Third quarter net operating income* of AED 14 million compared to AED 6 million in Q2 2022 backed by strong recurring revenues across all segments while maintaining firm cost discipline across the Group
- Cost to income ratio at 77% in Q3 2022 significantly lower than the 90% in Q2 2022
- Expanding operating margins for the business in Q3 2022 driven by lower costs
Balance sheet metrics expected to improve
in Q4 2022 driven by higher profitability and
further reduction of leverage
- Continued disciplined approach to deleveraging with debt-to-equity ratio at 124% in Q3 2022
Revenue Breakdown
Quarter-on-Quarter Revenues
Commentary
AEDm
Asset Management
Investment Banking
Corporate
89
84
72
14
(4)
6%
Strong recurring revenues continue to contribute
significantly across all business segments
§ Asset management continues to support |
recurring revenues driven by the strong |
contribution from fee earning AuM within real |
estate as well as managed public and private |
market funds. |
§ Investment banking revenues higher in Q3 2022 |
due to higher advisory and trading income |
64
46
13
23
28
4
5
3
57
45
38
33
Q3-21 | Q4-21 | Q1-22 | Q2-22 |
60
24
5
31
Q3-22
§ Corporate revenues robust in Q3 2022 amidst |
prolonged market volatility |
4 Restated - post GX reclassification to HFS
Asset Management Segment Performance
Asset Management Revenues | Commentary | |
AEDm
Real Estate
Public Markets
Private Markets
57
Debt
45
EBITDA | 27 | 19 |
Net | 16 | 11 |
Profit | ||
Posting healthy Q3 2022 results driven by the contribution | |
from fee earning AuM within real estate as well as | |
managed public & private market funds | |
Real Estate: | |
§ Continued contribution from recurring revenue and | |
management fees | |
38 | § Completion of landmark scheme The Broadway in |
Q3 2022 | |
33 | |
31 |
Public and Private Markets:
- Robust fee performance in managed funds
Debt:
- Stable recurring management fee revenues
10 | 13 | 5 |
(29) | (30) | (4) |
5
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SHUAA Capital PSC published this content on 11 November 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 11 November 2022 08:11:01 UTC.
