The losses racked up on asset-based is a particular worry, with the declines running deep in sectors such as retail. Image Credit: Gulf News Archive

Dubai: Bahrain’s Investcorp slipped into a $165 million loss for the 12 months ended June 30, against profits of $131 million a year ago.

The COVID-19 played its part in the loss, as fee income contracted 23 per cent to $288 million from $376 million. “Despite reduced fee income, the increased reliance on - and stability of - recurring fee income helped to cover operating expenses,” the company said in a statement. (The company's financial year ends June 30.)

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The ensuing “recession” also impacted on asset-based income, which recorded a $100 million loss from an $89 million profit. It was attributed to “fair value declines” related to a number of assets operating in “secularly challenged industries”, retail being one of them.

Stick to its strategy

In a statement, Mohammed Alardhi, Executive Chairman, said: “The growth and diversification strategy we introduced in 2015 has helped increase our resilience by offering a more diverse, multi-asset class, global platform. We continue to remain confident in our growth strategy, having entered this crisis and approaching our 2021 fiscal year in a position of strength with $1.2 billion in accessible liquidity and $32.2 billion in assets under management (AUM).

“While the short-term economic outlook remains uncertain due to the ongoing pandemic, we are committed to advancing our growth strategy and reaching $50 billion in AUM over the medium term."

Favourable numbers
In the 12 months to end June 2020, Investcorp achieved investment activity of $3.1 billion ($2.9 billion in FY-2019), placement and fundraising of $4.9 billion ($5.7 billion) and distributions of $2.6 billion ($4.0 billion).