Shuaa Capital’s core operating business remains resilient, chief executive says

Company describes itself as 'well-positioned' to benefit from the GCC's positive economic outlook

Shuaa Capital has made several key transactions in recent quarters. Pawan Singh / The National

Dubai-based investment bank Shuaa Capital’s core business remained strong despite volatility in global markets, the company said in its third-quarter financial results on Friday.

"Our core operating business remained resilient and delivered another strong set of recurring revenues across all business segments,” said Fawad Khan, group chief executive of Shuaa Capital.

Shuaa is committed to providing pioneering investment solutions to clients, he said, "as evidenced by the project completion of The Broadway [real estate project in London] and the increase in the number of managed funds our clients have access to".

The company increased its assets under management with the addition of $220 million to its discretionary portfolio management and funds in the third quarter of 2022.

Shuaa manages $14 billion in assets and the company is "well-positioned to benefit from the GCC's positive economic outlook", it said.

Middle East and North Africa economies are set to expand at their fastest pace since 2016, with GCC economies projected to grow 6.9 per cent in 2022, driven by high oil prices, as well as higher growth rates in non-oil sectors.

Saudi Arabia’s GDP is forecast to expand 7.6 per cent this year after 3.2 per cent growth in 2021, according to the International Monetary Fund, while Saudi investment bank Jadwa Investment estimates output this year at 8.7 per cent and the OECD projects growth of 9.9 per cent.

The UAE economy, which made a strong rebound from the pandemic-driven slowdown in 2021, has picked up pace this year. It is set to expand by 5.4 per cent in 2022, according to the UAE Central Bank.

Emirates NBD, Dubai’s biggest lender, expects the economy to expand 7 per cent in 2022, setting up the country for its fastest annual expansion since 2011, when output grew by 6.9 per cent.

Meanwhile, Abu Dhabi Commercial Bank projects growth of 6.2 per cent, driven by both the oil and non-oil sectors of the economy.

Higher oil prices this year have led to GCC budgets running surpluses, strengthening sovereign balance sheets, and resulting in a surplus of capital being available for investment opportunities.

Saudi Arabia posted a $21bn budget surplus in the second quarter, while Oman recorded a budget surplus of more than 1.12bn rials ($2.91bn) in the first nine months of this year, compared with a deficit of more than 1bn rials in the same period of last year.

Shuaa's third-quarter net profit attributable to owners of the parent for the three months to end of September, fell 42 per cent to Dh20m from the same period a year earlier, on the back of lower operating revenue and higher expenses, the company said in a regulatory filing to the Dubai Financial Market, where its shares are traded.

Net operating revenue for the period slid 16 per cent year-on-year to Dh60m, while total operating expenses rose more than 10 per cent to Dh52.7m. The company reported a loss for the nine-month period.

Shuaa has made several key transactions in recent quarters.

They include the listing of Anghami, the first Arab technology company on Nasdaq, through a special purpose acquisition company (Spac), the management of a $50m structured sukuk for UAE-based agriculture technology company Pure Harvest Smart Farms and the acquisition by its managed fund of Stanford Marine and Allianz Marine and Logistics Services Holding to create the world's fourth-largest operator of offshore support vessels.

Shuaa also unveiled a $100m initial public offering as the first of its three planned Spacs on Nasdaq New York in March.