UAE firms’ Q1 profits rise more than 50%, outperforming GCC peers – News

Gulf companies’ profits dip as commodity prices fall

Listed companies in Dubai and Abu Dhabi saw net profit growth of more than 50% year-on-year in the first quarter of 2023, outperforming peers in the Gulf Cooperation Council, whose quarterly profits fell due to falling energy and commodity prices.

Net profit of Dubai-listed companies rose 51.2% to $4.8 billion in the first quarter of 2023, compared to $3.2 billion in the same period in 2022, mainly driven by higher earnings in the banking, real estate and capital goods sectors, Kamco Invest said in its GCC Q1 2023 corporate earnings report.

In Abu Dhabi, net profits of listed companies rose 51.8 percent year-on-year to $11.1 billion in the first quarter of 2023, compared to $7.3 billion in the first quarter of 2022, according to a research report written by investment director Junaid Ansari Strategy & Research and Mohamed Ali Omar, partner at Kamco Invest.

The total net profit of Dubai’s banking sector soared 84.2% to US$2.8 billion in the first quarter of 2023, from US$1.5 billion in the first quarter of 2022. The growth in total revenue for the sector was largely driven by Emirates NBD for the second consecutive quarter, with net revenue jumping 114.7% to $1.6 billion from $746.2 million in Q1 2022. The bank’s strong performance was attributed to its record-breaking retail lending quarter, the report said.

In Dubai’s real estate sector, total net proceeds jumped 31.4% to $1.2 billion in the first quarter of 2023, compared to $950 million in the first quarter of 2022. Kamco said Emaar Properties’ net profit of $872.9 million in the first quarter of 2023, compared to $609.6 million in the first quarter of 2022, helped boost the sector’s total earnings.

In Dubai’s Utilities segment, total profit edged down 0.5% to $248 million compared to $249.3 million in the first quarter of 2022.

Abu Dhabi’s utilities sector, made up of just one company – ADNEC – will be the first in 2023 after reporting a net profit of $3.2 billion (compared to $536.6 million in Q1 2022). Ranked among the best in the industry’s total profit for the quarter. The banking sector then posted a smaller 3.2% year-on-year profit increase to $2.2 billion in the first quarter of 2023, up from $2.1 billion in the first quarter of 2022.

Across the GCC, aggregate net profits of listed companies fell by 9.1% to $61.5 billion in Q1 2023, from $67.9 billion in Q1 2022. “Energy, Materials and Diversified Financials are the top three industries with year-on-year declines in absolute profits compared to Q1 2022, as these industries accounted for 56% of total profits in Q1 2023 compared to 70% of -2022. In terms of quarter-on-quarter performance, profit growth was driven primarily by higher profits in the banking and utilities sectors, but was partially offset by lower profits in the energy, capital goods and materials sectors. In terms of regional trends, this quarter Profits on GCC exchanges rose sequentially, except for Saudi Arabia,” they said.