20200706 shuaa
Shuaa Capital reported net profits of Dh59 million for the third quarter. Image Credit: Gulf News Archive

Dubai: Shuaa Capital reported a net profit of Dh59 million for the third quarterand  taking the year-to-date net tally to Dh64 million. It also saw continued strong EBITDA (earnings before interest, tax, depreciation and amortization) generation with the third quarter fetching Dh114 million.

This performance was primarily driven by positive mark-to-market effects on the investment portfolio despite negative valuation adjustments. The asset management business maintained a solid base, increasing to $13.6 billion at the end of third quarter compared to $13 billion in the second.

Integration targets

With post-merger systems and  integration on track, Shuaa realized 55 per cent of its synergies target to be achieved by end 2021. This translates to Dh30 million out of the Dh55 million target.

The fund manager continues to downsize on its non-strategic assets, achieving a 39 per cent reduction in its non-core asset unit since July 2019 to date and remains on track to close it by end of next year. In the last quarter, Shuaa launched new funds to "increase recurring revenue streams through permanent capital vehicles".

Managing those funds

Shuaa recently launched a bond, which was the "first high-yield issuance in the region since March and which raised $150 million. The bond listed on London Stock Exchange’s International Securities Market on October 28. With this, Shuaa completed its funding plan for 2020.

“With a clear strategy to achieve long-term sustainable growth, Shuaa has continued to achieve significant progress in Q3-20," said Jassim Alseddiqi, CEO. "We have been able to achieve so much, operationally - with the successful launch of our new funds in recent months - and financially, increasing our earnings visibility.”