Bader Nasser Al-Kharafi:
- The National Investments Company maintained positive profitability rate indicators, confirming its solid financial position and dense foundation.
- The figures confirm NIC’s ability to maintain reasonable revenues and client profitability.
- The company is taking proactive steps towards developing operating profits by focusing on core investment activities and asset management services via seizing investment opportunities.
Fahad Abdulrahman Al-Mukhaizim:
- Our investment funds recorded impressive performance compared to other local funds established in Kuwait.
- We have attracted several investors during the first half of this year, provided notable advisory services, and managed mergers and acquisitions, sales and restructurings, private placements, and listings on Boursa Kuwait.
The National Investment Company (NIC) has unveiled its financial results, recording a net profit of KD 3.2 million for the three months ended on 30 June 2023, with a 194 % increase compared to the first quarter of this year which ended on 31 March 2023.
In a statement to the press, Mr. Bader Nasser Al-Kharafi, Chairman of NIC, stated that the company had achieved positive financial results for H1 2023, which complements the all-round positive performance achieved in the last three and half decades and resulted in outstanding successes within its diverse activities. This also placed NIC in the ranks of leading companies in Kuwait and the region and confirmed its position as one of the largest investment companies in terms of the volume of revenues and profitability, supported by positive results and its ability to maintain the interests of its clients at the forefront of their operations.
Solid Financial Position
Al-Kharafi also shed light on NIC’s profitability maintained in the first half of this year. Even though financial markets have suffered instability, the company continued to take advantage of the opportunities in the operating environment in Kuwait and the region.
NIC’s strategic approach led to achieving favorable levels in profitability indicators, efficiency of the operational performance, the contribution of sectors in operational processes, and the disciplined implementation of the company’s strategy. All factors helped achieve a balance through the ability to manage financials, and prudent risk management, in addition to the solid structure that symbolizes NIC and has a clear impact on achieving the desired strategic objectives.
Al-Kharafi added that NIC’s strategy is based on several foundations: diversifying sources of income, reducing risks, diversity, and innovation to achieve sustainable growth based on a clear methodology. He also praised the efforts made by the company’s executive team, which always works to translate the objectives of the Board of Directors to achieve the goals of shareholders and clients.
Financial Indicators
Commenting on the financial indicators of NIC, Al-Kharafi reviewed the positive results achieved by the company during the first half of 2023, which reflect its wise strategy. Despite the change in interest rates in the region and globally, which led to a decline of GCC market indices, by -4.1% in Kuwait, -2.3% in the UAE, and -6.6% in Qatar during the first half of 2023, the company continues to maintain a net financial profit of KD4.2 million and an earning per share of 5.3 fils per share since the beginning of 2023.
Al-Kharafi also mentioned that assets under management had reached KD 1.078 billion by the end of H1 2023, and the total shareholders’ equity of the parent company had reached KD 176 million.
“The total assets decreased by 6.6% to KD 244 million at the end of the second quarter of 2023, compared to KD 261 million in total assets at the end of the first quarter, due to the company’s distribution of approximately KD22.3 million cash dividends for the year 2022.” Added Al-Kharafi
“We extend our thanks to our shareholders for their continuous support and unwavering trust. As a company, we also value the loyalty of our clients throughout the years and their engagement with the services tailored to match their needs and expectations. I would also like to express our sincere gratitude to the regulatory authorities for their ongoing support and to our executive management for their commitment to our company’s vision and customer service strategy, emphasizing systematic work. Special thanks to our dedicated employees for their efforts in achieving growth and successfully implementing strategic objectives, leading NIC to become one of the region’s largest companies” concluded Al-Kharafi.
On the Corporate Social Responsibility front, NIC has intensified its strategic efforts as part of its annual program. It has played an essential role in this sector for over 35 years, offering support to people in need as a matter of social solidarity. Most recently, in cooperation with Kuwait Food Bank and Relief, NIC provided support to those in need during the holy month of Ramadan, an initiative which is in line with the company’s key objective to support activities that contribute to the development of society in its various humanitarian, social, and educational fields in addition to the field of sports.
Selective Management and Study
Mr. Fahad Abdulrahman Al-Mukhaizim, Board Member and CEO of National Investments Company, said: “We ended the first half of this year with positive results, as we focused on keeping pace with and meeting customers’ changing needs, offering the best services, which are tech-driven. The results also confirmed the success of the company’s plans within all the sectors, which positively impacted increasing those wishing to invest in distinguished opportunities, as well as through investment portfolios managed by the company for individuals and institutions locally and globally.
On the performance of the MENA Securities Sector, Al-Mukhaizim pointed out that the first half of 2023 was distinguished by the respectable version of the investment equity funds, which reflects the extent of excellence and success of the management in adopting strategies aimed at achieving financial returns for the company’s customers and its superiority over its counterparts in the market.
“Despite the factors driving market fluctuations and concerns related to global and local political and economic conditions, the most important of which are global political tensions and conflicts, weak expectations regarding global economic growth, high global inflation rates, and the continued tightening of monetary policy by the Federal Reserve by raising interest rates to control inflation, however, some of our investment funds have achieved good performance compared to the rest of the local funds established in Kuwait, thanks to rational decisions and prudent management of funds, and making investment decisions consistent with good and wise investment practices in achieving rewarding returns for unitholders by investing in shares of preferred companies with rewarding returns, solid management and a clear future vision, which had a significant impact on stability at the level of its cash distributions and grants.” Said Al-Mukhaizim.
He said that Zajil Services and Telecommunications Fund achieved a positive performance of 12.76%. Al Mada Investment Fund and Mawarid Fund for Industrial and Petroleum Services Fund achieved a positive performance of 5.23% and 4.94%, respectively.
Al-Mukhaizeem also highlighted that NIC was able to expand its portfolio as a Market Maker by adding Al- Safat Investment Company and renewing the contracts of KAMCO, ALARGAN International Real Estate Company, and Kuwait and Gulf Link Transport Company; and now offers the service to 11 shares of companies listed on Boursa Kuwait while effectively achieving the turnover and liquidity rates required on those shares.
Successful Deals
Al-Mukhaizim also praised the exceptional performance and efforts of the Financial Advisory Services Department and thanks to the company’s extensive network and strategic vision in attracting investments and distinguished advisory services and successfully managing many private placements and qualitative listings on Boursa Kuwait. An IPO was completed with a capital increase of Rai Media Group with a total value of US$ 4.4 million. NIC has also contracted with Aleid Foods Company K.P.S.C. as an underwriting agent to increase its capital and investment advisor for the potential acquisition. The team also succeeded in hiring two companies operating in the food and beverage sector to sell strategic stakes in them, advising a holding company on a partial purchase to acquire a minority stake in a company listed on Boursa Kuwait.
The Alternative Investments team is now auditing Europe’s venture capital fund manager, which includes a solid technical team. Our team is constantly looking for real estate and direct investment opportunities that show promising potential for rewarding returns. We also work on our current real estate investments per the expected plan, confirming their stability and positive expectations.
“The Wealth Management Sector continued to achieve important accomplishments during the first half of 2023, working on expanding the company’s customer base and attracting investors and new capital of approximately KD20 million. In addition to achieving growth in the number of new investment portfolios by 16% for the first half of this year and applying many practices that helped develop and improve investor service and keep pace with the latest technologies followed within the sector’—said Al-Mukhaizim.
The positive continuation witnessed by the Real Estate Investment Sector in maintaining the high occupancy rates in the company’s properties to unprecedented rates of 100% in some properties and working on renting the vacant units. The sector succeeded in obtaining new real estate management contracts; real estate portfolios also increased with several additional properties managed by the sector, accompanied by a 4.5% increase in revenue. In addition to the renovation and development of Wataniya Resort during the current year, the rise in the percentage of reservations reached 100% on occasions and holidays during the first half of 2023.
Al-Mukhaizim stressed that NIC is keen to focus and move forward with the comprehensive digital transformation plan within the framework of its strategic vision, and to expand the application of intelligent solutions to make a qualitative leap in innovative investment services and products in a manner that enhances the principle of sustainability, the essence of which lies in promoting and adopting the latest digital technologies in all areas of direct business with customers to meet all their needs and aspirations.
To conclude, Al-Mukhaizim commended the efforts made and the outstanding performance achieved by NIC during the first half of 2023, which reflects the success of the executive management in forming and executing effective strategies based on constructive presence in the market and gaining customer trust on the one hand, in addition to moving forward with innovation, excellence and competition on the other hand.
