Sico net profit surges 19 per cent

MANAMA: Bahrain-based Sico, a leading regional asset manager, yesterday said its net profit for the first half of 2018 increased by 19 per cent to BD2.5 million ($6.6m) from BD2.1m for the corresponding period of last year.

Total operating income grew by 19pc to BD6m from BD5.1m a year earlier. Total operating expenses, including staff overheads, general administration and other expenses, increased to BD3.2m from BD2.8m.

Earnings per share increased to Bahraini fils 6.74 compared with 5.06 fils for the first half of 2017. Total comprehensive income for the first half of 2018 was BD2.7m, representing an increase of 8pc from the comprehensive income of BD2.5m achieved in the corresponding period last year.

Board chairman Shaikh Abdulla bin Khalifa Al Khalifa said: “I am pleased to announce that the bank posted strong financial results for the first six months of 2018. Sico’s business lines enjoyed an active and successful first half, with highlights including a continuing upward trend in assets under management, with brokerage and investment banking maintaining their dominant market position, and the proprietary book posting a strong performance. Sico continues to demonstrate its ability to seize market opportunities and inspire investor confidence, positioning the bank to finish 2018 on a strong note.”

For the second quarter, Sico posted a BD1.07m net profit, a 39pc increase from BD769,000 during the same period of last year on the back of higher revenues across all business lines.

The bank reported a 21pc increase in total operating income, from BD2.3m to BD2.8m,while total operating expenses, including staff overheads, general administration and other costs, increased from BD1.4m to BD1.6m. Earnings per share, increased from 1.87 Bahraini fils to 2.89fils for the second quarter of 2018.

As of June 30, 2018, the balance sheet stood at BD137.5m compared with BD131.3m at the end of 2017. Assets under management have grown significantly to BD681.97m ($1.8 billion) from BD465.4m ($1.2bn), representing 47pc growth in comparison to the 2017 year-end balance. Assets under custody with the bank’s wholly-owned subsidiary, Sico Funds Services Company (SFS), grew from BD2.2bn ($5.7bn) as at December 31, 2017 to BD2.3bn ($6.1bn).

Sico continued to maintain a comfortable capital base, well above regulatory requirements, ending the period with a shareholders’ equity of BD54.6m (end-2017: BD59.8m). The lower capital base compared with December 2017 is primarily due to Sico acquiring back 10pc of its shares as treasury stock, amounting to BD5.9m, during the first half of 2018. Dividends’ amounting to BD1.93m were also distributed. Accordingly, the consolidated capital adequacy ratio stood at 57.92pc.

Chief executive Najla Al Shirawi said: “GCC government revenues and GDP received a boost over the past six months from strong oil prices, with Brent crude rising nearly 19pc in the first half of the year; we expect to see higher earnings in some key sectors. GCC market performances continued to diverge during the period, with Saudi Arabia and Kuwait markets strengthening due to their inclusion on MSCI and FTSE.”

Ms Al Shirawi continued: “Asset management maintained its robust growth trend with all Sico funds performing strongly against their respective benchmarks and peers. Sico maintained its position as the number one broker and leading market maker on the Bahrain Bourse, handling more than 7,314 transactions involving 773m shares worth a total value of more than BD145m. This translates to a market share in excess of 56pc.

“In addition, the Bahrain Liquidity Fund, for which Sico is the fund manager, continued to meet its objectives of increasing the liquidity and depth of the Bahrain Bourse, whereby the market’s total traded value jumped to BD128m in 1H18 with BLF contributing 28pc of the traded value.

“During the period, Sico was appointed lead manager and underwriter for an initial public offering by APM Terminals, the exclusive operator of Khalifa Bin Salman Port. The IPO, which is expected in the fourth quarter of 2018, will list 20pc of the company’s shares on the Bahrain Bourse.”