Ipic profit for 2013 up 23% amid global equity rally

International Petroleum Investment Company (Ipic), the Abu Dhabi-owned overseas energy investment holding company, said its full year 2013 profit increased 23 per cent amid a rally in global equities last year.

Profit for the year increased to Dh7.9 billion from Dh6.4bn in 2012, the Abu Dhabi-based company said. Revenue increased to Dh194bn from Dh190.6bn. Ipic’s total assets rose to Dh251.2bn at the end of December, compared to Dh239.3bn in the same period the previous year.

As well as the rally in global equity markets, Ipic cited the appreciation of the euro versus the US dollar, and acquisitions it made as reasons behind its profit growth.

“2013 was one of our most successful years to date,” said Khadem Al Qubaisi, Ipic’s managing director. “Ipic’s excellent results saw revenues rise to a record Dh194.0bn, a 23 per cent increase in profit, and a 10 per cent reduction of debt – befitting results to mark the beginning of Ipic’s 30th year of operations.”

“Over the past five years, Ipic’s consolidated assets have grown from Dh85.5bn to Dh251.2bn, showing a five-year compound annual growth rate of 24 per cent,” Mr Al Qubaisi added. “Consolidated revenue has grown from Dh36.2bn to Dh194.0bn, and consolidated operating profits have grown from Dh1.5bn to Dh9.2bn, representing compound annual growth rates of 40 per cent and 44 per cent, respectively.”

Global markets rallied last year amid signs of economic improvement and the continuation of monetary stimulus by the United States Federal Reserve. The MSCI All Country World Index, a benchmark measure of developed and emerging market world equities, rose 20.3 per cent in 2013 compared to a 13 per cent gain in 2012.

Ipic, created in 1984, owns a stake in 18 companies around the world, including refining companies in Japan and chemical makers in North America and Europe such as OMV Aktiengesellschaft of Austria and Cepsa of Spain.

Cepsa said in November that it had struck a C$2.3bn (Dh8.08bn) deal to acquire Houston-based Coastal Energy, which owns oil and gas assets in Thailand and Malaysia. Ipic’s Spanish oil unit said it entered into a definitive agreement to acquire 100 per cent of Coastal’s shares at C$19 each. As part of the acquisition, Cepsa will assume C$51 million worth of net debt.

Coastal’s acquisition is part of Cepsa’s strategy to expand its exploration and petrochemicals business in South East Asia, North Africa and South America.

Ipic, which has a credit rating of Aa3/AA/AA by Moody’s, S&P and Fitch respectively, is also building a US$4.5bn fuel-processing plant in Fujairah and spending $3bn on another similar plant in Oman.