(The Group’s Comments) Milaha Net Profit Up 10% to QR 516 Million in 2018

Ø  Profits: Milaha’s profits increased by 9.90% to QR 516.34 million for the year 2018, compared to QR 469.83 million for the previous year of 2017. The company’s earnings per share reached QR 4.45 in 2018, compared to QR 4.14 in 2017. As for 2018 fourth quarter profits, they amounted to QR 112.3 million, versus QR 83.9 million in the corresponding period of 2017.

It should be mentioned that the company witnessed a loss of non-controlling interests amounting to QR 4.53 million in 2018, which represents the adjustment of non-controlling interests in associates as a result of applying the IFRS No. 9. Therefore, the results for the year amounted to QR 511.81 million, while the profit attributable to the shareholders is QR516.34 million, which the profit on which the dividend is calculated.

Ø  Comprehensive income: The total comprehensive income amounted to QR 1,495.3 million by the end of 2018. Milaha recorded profits from revaluation of its financial investments of QR 735.19 million. These investments recorded an assessment loss of QR 874.7 million in 2017. The profit of the cash flow hedge valuation reached QR 248 million.

Ø  Revenues: Decreased by 3.0% to QR 2,416.2 million in 2018, and operating profit dropped by 11.3% compared to 2017. However, the increase in the share of the company from the results of joint ventures by QR 39 million, in addition to the decrease of non-recurring expenses by QR 79 million contributed to the growth of profits.

Ø  Shareholders’ equity: Increased by 7.6% to reach QR 14,582 million by the end of 2018, compared to QR 13,543 million in the previous year. The improvement in shareholders' equity resulted from the revaluation profits which amounted to QR 944 million for the year 2018. The return on equity was 3.51% versus 3.57% for 2017.

Ø  Dividend distribution: The Board of Directors recommended the distribution of cash dividends at a rate of 30% of the nominal value of the share (4.55% dividend yield), i.e. QR3.00 per share, noting that the distribution ratio of 2017 was 35% per share.

Ø  Market ratios: The stock is currently traded at a PE multiple of 14.85 times and a book value multiple of 0.52 times.