The Group Securities: Weekly Report on QSE Performance, 15-19 June 2018

General Index Climbs to the Level of 9421 Points

 

 

The results of the 13 companies that have disclosed their financial statements last week split between the increase of profits for 9 companies, and the decline in 3, while profits turned into losses for Investment Holding Company. This coincided with a sharp drop in the price of OPEC oil to just under US $70 a barrel. Therefore, the stock market performance was relatively weak. The total trading volume increased by 16.5% but remained below QR1 billion, and while the share prices of 19 companies increased, the share prices of 19 other companies declined. As a result, the general index rose by 102 points to 9421 points, the total capitalization rose by QR4.1 billion to QR512.4 billion and the P/E ratio climbed to a multiple of 13.04.

In depth, the general index increased by about 102 points or 1.10%, to the level of 9421 points, while Al Rayan Islamic Index increased by 1.31%. Sectoral indices increased, especially Insurance, Industry and Banking. It has been noticed that the share price of ZAD was the top gainer, up by 5.51%; followed by Industries Qatar by 4.39%, Qatar Insurance by 3.65%, Dlala 3.14%, then QIB by 2.83%. In contrast, the share price of Alijarah was the biggest loser, down by 3.16%; followed by Ezdan by 2.45%, Gulf International by 2.33%, and Aamal by 1.95%, then Ooredoo by 1.91%.

Total trading volume climbed by 16.48% to the level of QR908 million in a week, with an increased average daily trading of QR181.6 million. QNB led the traded shares with a volume of QR164.8 million, followed by the share of Vodafone with QR89.6 million, Industries Qatar with QR64.1 million, and Nakilat with QR63.4 million. It was noticed that Qatari portfolios made net purchases of QR58.1 million, while Non-Qatari portfolios made net purchases of QR66.2 million. Qatari individuals made total net sales of QR120.8 million, whereas foreign individual investors made net sales of QR3.5 million. As a result, QSE’s total capitalization climbed by QR4.1 billion to reach QR512.4 million, but the P/E ratio dropped to a multiple of 12.91 compared to 13.04 from last week.

Corporate News:

1-      QIB’s net profit for the first half of 2018 amounted to QR1.32 billion, compared to QR1.16 billion for the same period last year, while the bank’s earnings per share recorded QR5.61 in the first half of 2018, compared to QR4.93 in the same period in 2017. QIB's operating income increased by 7% to QR3.37 billion in the first half of 2018, and its total expenses increased by 6.96% to QR690.3 million, of which QR321.3 million for personnel costs. The bank recorded a net loss in value of financial investments and assets of QR388.6 million, and the share of restricted investment holders increased to QR1,000 million. The result is an increase of 13.7% in the net profit attributable to shareholders to QR1.32 billion.

 

2-      Masraf Al Rayan’s net profit amounted to QR1.06 billion in first half of 2018 compared to QR1.02 billion for the same period of the previous year, while the bank’s earnings per share recorded QR1.42 in the first half of 2018 compared to QR1.36 in the same period in 2017. Al Rayan's total revenues rose by 18% to QR2.43 billion in the first half of 2018 as a result of the bank’s increased financing activities, while its total expenses increased by 54.8% to QR727.7 million, of which QR397.6 million were financing expenses – i.e., the Bank received significant funds to support its operations. The share of unrestricted investors increased by 5.8% to QR608.1 million, although the balance of those accounts increased by only 3.2% to QR55.9 billion. The Bank's net profit for the first six months of 2018 climbed to QR1,065.9 million, 4.5% more compared to the corresponding period of 2017.

 

3-      Widam Food net profit of amounted to QR60.6 million in the first half of 2018, compared to QR54.14 million in the same period last year, while the company’s earnings per share recorded QR3.37 in the first half of 2018, versus QR3.01 for the same period in 2017. Widam Food sales revenues climbed in the first half of 2018 to QR282.4 million, an increase of 11.4% compared to the same period of last year. However, the cost of sales rose by 34.3% to QR503 million, bringing the total loss to 80.8%, or QR503 million. It should be noted that Government subsidy increased 52% to QR302.8 million, and with general and administrative expenses at QR27.7 million, in addition to other income of QR6.2 million, the net profit increased by 12% to QR60.61 million.

 

4-      Ezdan Holding Group’s net profit amounted to QR422.3 million, 63% lower than the net profit of QR1.15 billion recorded in the same period last year, while the group’s earnings per share recorded QR0.16, versus QR0.44 for the corresponding the period of 2017. Ezdan’s net operating income shrank by 56.7% to QR659 million in the first half of 2018. This sharp decline was a result of loss of profits in the past period from the sale of investments and shares in companies amounting to QR640 million. Despite the decrease in general and administrative expenses by 14.7% to QR117 million, financing costs increased by 34.5% to QR450.3 million. It should be noted that there were gains in the fair value of investments amounting to QR267.8 million. As a result the net profit for the first half of 2018 suffered a drop of 63.4% to QR422.3 million. In terms of comprehensive income, and with a change in fair value of QR213 million, the total comprehensive income amounted to QR650.1 million, versus QR818.1 million in the corresponding period of 2017.

 

5-      United Development Company net profit amounted to QR260 million, compared to QR284 million recorded in the same period last year. The company’s earnings per share recorded QR0.74 in the first half of 2018, versus QR0.80 in the corresponding period of 2017. UDC’s net income declined by 5.8% in the first half of 2018 to settle at QR444.7 million, while income from investments and others increased 25.4% to QR83.8 million. General and administrative expenses and sales decreased by 6.6% to QR152.3 million. Adding losses on the fair value of financial investments of QR31.8 million, and the increase of net financing cost by QR10.5% to QR69.2 million, the result is a decline in the net profit of 8.3% to QR260.4 million in this period.

 

6-      Commercial Bank Group’s net profit amounted to QR855 million, compared to QR180 million for the same period last year, while the bank’s earnings per share amounted to QR2.11, versus QR0.45 for the same period of 2017. Commercial Bank’s net income from its activities in the first half of 2018 increased by 3.7% to QR1832.7 million, but expenses diminished by 33.3% to QR1,066.1 million (this decrease was due to a reduction in loan losses by half or QR428 million). After adding the share in profits of other companies worth QR86.5 million, the net profit for this period multiplied several times to settle at QR855.1 million. In terms of comprehensive income, there were currency differences and fair value losses of QR532 million. As a result, the comprehensive income decreased to QR323 million, compared to QR332.6 million recorded in the corresponding period of 2017.

 

7-      Ahli Bank’s net profit amounted to QR353.23 million, compared to QR342.21 million for the same period last year, while the bank’s EPS recorded QR1.68 versus QR1.63 for the same period of 2017. Ahli bank’s total income increased by 3.9% to QR538.1 million. The bank’s total expenses also increased by 5.2% to QR184.8 million, of which QR87.8 million went to staff expenses and QR84.4 million for loan losses and investments. Consequently, the net profit rose by 3.2% to QR353.2 million with a slight change in the fair value that amounted to QR7.2 million.

 

8-      Qatar Electricity & Water Company’s (QEWC) net profit amounted to QR813 million, compared to QR811 million for the same period in 2017, while the company’s earnings per share recorded QR7.39 for the six months ended 30 June 2018, versus QR7.37 for the same period last year. QEWC’s revenues generated from sales dropped by 12.6% to QR1,344.2 million, but its net after-cost revenues fell by only 1.5% to QR650.9 million due to a large cost reduction. After adding other income of QR94.6 million to profit from joint ventures amounting to QR280.1 million, and deducting general expenses of QR96.1 million and financing costs of QR102.5 million, the result is a net profit of QR280.1 million, marginally increased compared to last year.

 

9-      Qatar International Islamic Bank’s (QIIB) net profit amounted to QR484 million, compared to QR465 million for the same period last year, while the bank’s earnings per share recorded QR3.20 in the first half of 2018, versus QR3.07 in the corresponding period of 2017. QIIB’s total income increased by 14.8%. The bank’s total expenses increased by 6.63% to QR252.6 million. Shareholders' share of profits rose by 31.8% to QR270.5 million, an increase of only 18.5%. As a result, the net profit increased 4% to QR484 million.

 

10-  The results of Doha Bank, Al Khaliji, Gulf Warehousing and Islamic Holding were released later on Thursday. The results varied between a profit-to-loss as in the case of Investment Holding Company, a decline in profits as in Doha Bank, and an increase in profits as in the case of Al Khaliji and GWC.

 Economic Developments:

1-      OPEC oil fell by about US $4.42 to the level of US $69.98 per barrel until 11th of July, compared to US $74.40 per barrel a week prior.

2-      Dow Jones rose again by about 805 points to the level of 25021 points until closing on Thursday. US dollar stood at $1.16 against the Euro, and against the yen at ¥112.40 per dollar. Gold declined by about US $20 to US $1223 per ounce.