E a r n i n g s P r e s e n t a t i o n
F Y 2 0 2 2
23 March 2023
© 2023 SHUAA Capital psc. All rights reserved
Executive Summary
Financial Measures
Key Metrics
Group
Updates
- Full year operating income (excluding carry expense) continues to show progress at AED 17 million in 2022, driven by firm cost optimization measures across the group and recurring revenues.
- The Group reported a net loss of AED 135 million in full year 2022 compared to a net profit of AED 24 million in the previous year.
- The result included one-timenon-cash charges attributed to mark-to-market losses in our managed funds and accelerated amortization of intangible assets.
- Stable operating margins for the business in 2022 at ~10% mainly due to cost efficiencies.
- The cost-income ratio of 93% in 2022 is 6% lower than 2021 despite an 18% drop in revenues highlighting the reduction in operational leverage of the business through cost optimization.
- Revenue enhancing initiatives are set to continue with the cost-income ratio expected to meet management medium-term target of 65%.
- The Group's continued focus on deleveraging panned out with the Debt-to-Equity ratio improving to 105% in 2022 from 134% in 2021. AED 169m of debt repayments made during FY 22.
- Real Estate: In Q4 2022 we have proudly announced the partnership with Ellington Properties and Sol Properties to develop a prime waterfront property on Palm Jumeirah.
- Asset Management: In Q4 2022, we launched three new Shariah-compliant funds, bringing the ICC umbrella Funds to five with assets under management (AuM) at USD 230 million.
- Corporate: Expense base stabilizing in 2023 with ~AED 100m of reductions through disposal of assets and cost efficiencies from 2022 (Vs. AED 248m in FY2022) and significantly simplified balance sheet via AED 2b of asset + AED 1.7b of liability deconsolidation in last 24 months.
Key Financial Highlights FY 2022
FY 2022 Financial Performance
Income Statement (AED Mn) | % Change | % Change | |||||
FY 2022 | FY 2021 | vs. FY 21 | Q4-22 | Q3-22 | vs. Q3-22 | ||
Net Fee and Commission Revenue | 251.1 | 295.7 | (15%) | 45.9 | 68.4 | (33%) | |
Other Revenue | 14.7 | 27.0 | (46%) | 5.1 | (0.4) | - | |
Total Revenues | 265.7 | 322.7 | (18%) | 51.0 | 68.1 | (25%) | |
Operating Expenses (excl. carry | (248.4) | (281.1) | 12% | (38.6) | (65.2) | 41% | |
expense) | |||||||
Net Operating Income (excl. Carry | 17.4 | 41.6 | (58%) | 12.4 | 2.9 | 334% | |
expense) | |||||||
Commentary
Net operating income of AED 17 million
underpinned by cost efficiencies and strong
recurring revenues in FY 2022
§ FY 2022 net loss of AED 135 million |
compared to AED 24 million of net profit |
in 2021. 2022 results included AED 83 |
Carry Expense
Net Operating Income/(Loss)
Other Income/(Expenses)
Profit/(loss) from discontinued operations and Disposal of Subs
Non-Controlling Interests
Net Profit/(Loss) 1
EBITDA 2
Key Metrics
Operating Margin (%) excl. one-off items and carry expense
CIR (%)
Balance Sheet (AED Mn)
Total Assets
Total Debt
Total Equity
Key Metrics
Debt to Equity
Return on Equity - Parent
(5.5) | (10.4) | - | (0.2) | - | - |
11.8 | 31.2 | (62%) | 12.2 | 2.9 | 327% |
(1.7) | (178.0) | - | (24.5) | 125.4 | - |
(132.6) | 217.8 | - | 2.1 | (47.9) | - |
(12.7) | (46.7) | - | 19.4 | (60.3) | - |
(135.2) | 24.2 | - | 9.2 | 19.9 | (54%) |
135.0 | (54.7) | - | 38.6 | 102.1 | - |
7% | 13% | (6%) | 24% | 4% | 20% |
93% | 87% | 6% | 76% | 96% | (20%) |
% Change | % Change | ||||
FY 2022 | FY 2021 | vs. FY 21 | Q4-22 | Q3-22 | vs. Q3-22 |
3,476 | 5,768 | (40%) | 3,476 | 3,766 | (8%) |
1,594 | 2,474 | 36% | 1,594 | 1,940 | 18% |
1,520 | 1,846 | (18%) | 1,520 | 1,566 | (3%) |
1.05x | 1.34x | 29% | 1.05x | 1.24x | 19% |
(10%) | 2% | (12%) | (3%) | (3%) | 0% |
million of one-off charges mainly taken | |
to simplify the business. | |
§ | Cost to income ratio at 93% in 2022 lower |
than 2021 due to drop in revenues | |
partially offset by cost efficiencies. | |
§ | Stable operating margins for the |
business in 2022 driven by cost | |
efficiencies. |
Balance sheet metrics on upward trajectory
- Continued disciplined approach to deleveraging with debt-to-equity ratio at 105% in FY22 compared to 134% in FY21
1 Net Profit attributable to shareholders
3 2 Excludes results for discontinued operations
Revenue Breakdown
Quarter-on-Quarter & Year-on-Year Revenues
Commentary
AEDm
Asset Management
Investment Banking
Corporate
82 | ||
68 | ||
12 | ||
13 | 32 | |
57 | 5 | |
31 | ||
51
3
2
46
323
82
29
211
(57)
-18%
266
103
16
147
Recurring revenues continue to contribute
significantly with improved business momentum
across all segments
- Asset management continues to support recurring revenues driven by the strong contribution from real estate management income
- Investment banking revenues lower in Q4 as a result of cyclicality and timing of deal closures
- Corporate revenues robust in Q4 2022 amidst prolonged market volatility
Q4-21 | Q3-22 | Q4-22 | FY21 | FY22 |
4
Asset Management Segment Performance
Asset Management Revenues
AEDm | |||||||
Real Estate | |||||||
Public Markets | |||||||
Private Markets | |||||||
Debt | 211 | ||||||
11 | |||||||
6 | |||||||
68 | 147 | ||||||
5 | |||||||
19 | |||||||
31 | |||||||
57 | |||||||
46 | 125 | ||||||
1 | 31 | ||||||
92 | |||||||
27 | 7 | ||||||
3 | 10 | ||||||
28 | 7 | 28 | |||||
20 | |||||||
Q4-21 | Q3-22 | Q4-22 | FY 21 | FY 22 | |||
EBITDA | 19 | 2 | 29 | 109 | (11) | ||
Net | 11 | (4) | 24 | 71 | (39) | ||
Profit | |||||||
Commentary
Posting healthy Q4 2022 results driven by the contribution from recurring real estate revenues coupled with resilient fee performance from managed public & private market funds
Real Estate:
- Continued contribution from recurring revenue and management fees
- New project launched in Q3 2022
Public Markets:
- Robust fee performance in managed funds
Private Markets:
- Resilient recurring management fee revenues
Debt:
- Stable recurring management fee revenues
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Disclaimer
SHUAA Capital PSC published this content on 22 March 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 23 March 2023 09:02:01 UTC.