Dubai: Dubai Financial Market (DFM) recorded a 69 per cent fall in net profit in the first quarter to March, but said its outlook remained favourable due to sound fundamentals of listed companies.
The DFM posted net profit of Dh67.7 million in the quarter to March from Dh215.1 million in the same period last year, the exchange said in a statement.
The company’s total revenue has decreased by 55 per cent to Dh114.5 million compared to Dh255.6 million in the same period last year.
DFM’s trading value has dropped 65.3 per cent during the first quarter to Dh38.2 billion compared to Dh110 billion during the corresponding period of last year. Trading commission is the main revenue stream for the DFM Company.
The sharp decline of oil prices in 2014 has hindered sentiment and accelerated the slowdown leading to a 66 per cent decline in the average daily of trading value to Dh606.4 million compared to Dh1.7 billion during the same period of last year, impacting revenues.
Essa Kazim, Chairman of Dubai Financial Market sees these factors as passing circumstances.
“For instance, oil prices are relatively stabilising near levels way above many analysts anticipated. The UAE remains among the least affected in the region. More importantly, macroeconomic indicators are positive and promising. The national economy maintains its high growth rates of almost 5 per cent as a result of the successful economic diversification policies,” Kasim said.
Interest
The DFM is seeing intensified interest from various investor categories following its classification as emerging market supported by its highly advanced regulations and all-inclusive infrastructure.
The DFM listed four new public joint stock companies from some of the most dynamic and unrepresented sectors, namely tourism, education, health care and retail.
“We expect further listings over the coming period considering the bursting pipeline of companies that are in advanced stages of transforming into public joint stock company and list on DFM and this will further boost trading activity in the future,” Kazim added.