GFH posts $73.6m net profit

MANAMA: GFH Financial Group has reported a decrease of 21 per cent in net profit for the third quarter of 2019 at $24.4 million when compared with $30.9m in the third quarter of 2018.

Earnings per share were 0.74 cents compared with 0.87 cents in the third quarter of 2018.

Consolidated net profit was $21.8m compared with $31.3m in the third quarter of 2018, a decrease of 30.1pc.

Profit from continuing operations was $21.8m compared with $29.6m in the third quarter of 2018, a decrease of 26.2pc.

Total income increased by 27.1pc to $90.5m versus $71.2m in the third quarter of 2018.

Total expenses including provisions for impairment were $68.7m compared with $41.6m in the third quarter of 2018, an increase of 65.1pc.

For the third quarter, operating expenses were $21.4m versus $28.4m in the prior-year period, a decrease of 24.6pc.

For the first nine months of 2019, net profit was $73.6m compared with $103.4m in the prior-year period, a decrease of 28.8pc.

However, excluding one-off recovery income and restructuring income in the first nine months of 2018 of $57.8m, net profit grew by 61.4pc in the first nine months of 2019.

Earnings per share were 2.19 cents compared with 2.91 cents for the first nine-months of 2018.

Consolidated net profit was $70.2m for the nine-month period compared with $104.7m in the first nine months of 2018, a decrease of 33pc.

The decrease in net profit is due to lower contribution from the commercial banking arm due to higher impairment provisions taken during 2019.

Profit from continuing operations for the first nine months of 2019 was $70.7m compared with $100m in the prior year period, a decrease of 29.3pc.

The group reported a 23.7pc increase in income to $254m compared with $205.3m in the first nine months of 2018.

Excluding the one-off recovery income and restructuring income in the first nine months of 2018, total income of the group for first nine months of 2019, grew by 72.2pc.

Contributing to solid income growth was the continued positive performance of the core investment banking business, real estate activities and income generation from treasury and proprietary investments.

For the period, investment banking contributed 31.1pc to the total income mainly from placement activities and contributions from treasury activities continued to grow reaching 24.1pc of total income.

Improved performance was also reported in real estate, which accounted for 7.9pc while proprietary investments and commercial banking contributed 16.3pc and 20.6pc, respectively to total income for the first nine months of the year.

Total expenses including provision for impairment were $183.3m compared with $105.3m in the prior-year period, an increase of 74.1pc, primarily due to a 198.9pc increase in impairment provisions in the commercial banking business and an increase in the finance costs as part of treasury portfolio.

Operating expenses for the period were $70.2m compared with $71m in the first nine months of 2018, a decrease of 1.1pc.

Total assets increased to $6.14 billion as of end-September 2019 from $4.43bn in the prior-year period, an increase of 38.6pcpc while liabilities increased to $3.75bn from $2.1bn in the previous year period, an increase of 78.6pc.

Total equity increased marginally to $1.07bn as of end-September 2019 from $1.06bn as of end-December 2018.

Chairman Jassim Al Seddiqi said, “We’re pleased to announce another period of solid growth and improvements in income generation and operating performance at GFH. Quarter after quarter, we see the group’s strategy to diversify the business and focus on investments and activities that can support steady income generation paying off.

“We saw revenues increase once again aided by strong performance in investment banking, real estate and treasury activities. For the remainder of the year, we will continue to focus on maximising the performance and returns derived from both new and existing assets and remain committed to deliver stronger performance by year-end.”

Group chief executive Hisham Alrayes said, “Growth and increased income from core business lines continued throughout the first nine months of 2019. During the third quarter, we placed unique opportunities capable of providing strong income generation and returns for the group and our investors.

“These were in key focus sectors including technology, fintech and education. We also realised the benefits of further progress in our real estate development activities, newly established treasury business line and proprietary investments.

“In our commercial banking business, we took a conservative position taking some provisions on the portfolio in line with market conditions, but expect contributions from this areas of the business to increase in 2020.

“For the period ahead, we will continue to build on the momentum we’ve enjoyed thus far this year and look forward to finishing 2019 with solid results.”

Source: http://www.gdnonline.com/Details/648394