The Group Securities: Weekly Report on QSE Performance, 29 July - 2 August 2018

“General Index Keeps Climbing and Approaches 10,000 Points”

Although last week’s results of listed companies were not strong – with the exception of a limited number of companies – and the total of the disclosed results of 35 companies declined by 1.16% compared to the corresponding period of last year, and although oil prices were significantly lower in the beginning of August, the performance of the stock market was surprising by all accounts. On the one hand, the overall trading rose by 25.8% to QR1.22 billion. On the other hand, the general index climbed by 373 points, exceeding its previous level before the start of the blockade, and reached the level of 9981 points. The total capitalization also gained about QR25.8 billion in a week, reaching QR550.5 billion. However, the share price of only 26 companies rose, while the share price of 16 companies declined, and the share price of 3 companies remained unchanged.

In depth, the general index increased by about 373 points or 3.89%, to the level of 9981 points, while Al Rayan Islamic Index increased by 2.14%. Sectoral indices rose, especially Real Estate, Banking, and Insurance. It has been noticed that the share price of Ezdan was the top gainer, up by 23%; followed by QNB 8.6%, Qatar Insurance by 7.6%, Islamic Holding by 7.59%, then QIB by 6.85%. In contrast, the share price of Khaleej Takaful was the biggest loser, down by 4.59%; followed by Ooredoo by 4.54%, Qatar First Bank by 4.1%, and Qatar Cinema by 3.6%, then Dlala by 3.3%.

The total trading volume climbed by 25.8% to the level of QR1.217 billion in a week, so the average daily trading volume increased to QR243.4 million. QNB led the traded shares with a volume of QR239.1 million, followed by the share of Nakilat with QR102.3 million, Industries Qatar with QR102.2 million, and Commercial Bank with QR90.9 million. It was noticed that Qatari portfolios made net sales of QR88.3 million, while Non-Qatari portfolios dominated the net purchases with QR203.1 million. Qatari individuals made total net sales of QR88.2 million, whereas foreign individual investors made net sales of QR26.5 million. As a result, QSE’s total capitalization climbed by QR26.8 billion to reach QR550.5 million, and the P/E ratio rose to a multiple of 14.10 compared to 12.99 from last week.

Corporate News:

1-      Aamal’s net profit amounted to QR228.9 million, compared to QR240.4 million for the same period last year, while the company’s earnings per share reached QR0.36 in the first half of 2018, versus QR0.38 for the corresponding period of 2017. Aamal’s total profit from activity declined by 20.6% to QR243.2 million in the first half of 2018, but the company generated other income of QR4.4 million. Expenses, on the other hand, rose by 10.5% to QR70.4 million. As a result, operating profit decreased by 30% to QR177.2 million. The share of other companies' results has doubled to QR53.9 million, and the cost of financing shrunk to less than QR1 million, resulting in a net profit decline of 4.8% to QR228.9 million.

2-      Ooredoo’s net profit amounted to QR689 million in the first half of 2018, compared to QR1,097 million for the same period last year, while its earnings per share reached QR2.15, versus QR3.42 for the same period in 2017. Ooredoo’s total operating income decreased by 6% to QR15.29 billion, while its total expenses declined by 1.1% to QR14.22 billion. After adding other revenues, the company’s share in the results of joint ventures totaling QR352.8 million, compared to QR88.7 million in the corresponding period of 2017, and deducting privileges and fees of QR281.7 million, as well as income tax of QR262 million, the result is a profit attributable to shareholders of QR688.9 million, a drop of 37.2% compared to the corresponding period of 2017. After subtracting currency losses and taking into account the decline in fair value totaling QR674.4 million – both generated profits of QR184.2 million in the previous year – the total comprehensive income shrank to QR140.9 million, compared to QR1,267.6 million.

3-      Qatar Islamic Insurance’s net profit amounted to QR41.11 million in first half of 2018, compared to QR36.06 million for the same period last year, while its earnings per share reached QR2.74, versus QR2.40. Qatar Islamic Insurance’s total revenues climbed by 12.4% to QR60.8 million in the first half of 2018, of which QR50.5 million were generated from insurance brokerage fees, and QR4.30 million from rents. Expenditures remained relatively stable at QR16.7 million with a slight increased. As a result the net income rose by 13.9% to QR41.1 million.

4-      Al Khaleej Takaful’s net profit amounted to QR7.75 million in the first half of 2018, compared to QR16.45 million in the same period of the previous year, while its earnings per share reached QR0.30, versus QR0.64. Al Khaleej Takaful’s total income from insurance and investments decreased by 31.1% to QR25.3 million in the first half of 2018, while its total expenses diminished by 13.1% to QR17.6 million. As a result, the company’s net income declined by 42.8% to QR7.76 million.

5-      Qatar Fuel’s (Woqod) net profit amounted to QR503 million, compared to QR373 million for the same period last year, while its earnings per share reached QR5.06 in the first half of 2018, versus QR3.75 for the corresponding period of 2017.Woqod’s total profit from activity in the first half of 2018 increased by 7.8% QR566.9 million, while other revenues climbed by 45.9% to QR192.4 million. In contrast, expenditures increased by 2% to QR192.4 million. Net profit increased by 34.9% to QR503.2 million, and there was a limited decline in the comprehensive income QR495.3 million.

6-      Qatar Navigation (Milaha) showed a net profit of QR297 million in first half of 2018, compared to QR267 million in the same period of the previous year, while its earnings per share amounted to QR2.62, versus QR2.35. Milaha’s operating income increased by 9.4% to QR1.25 billion in the first half. Of 2018, as well as its share in the profits of its associates by 8.5% to QR139.7 million, while its share of joint arrangements multiplied to QR82.1 million. On another hand, the company’s expenses of all kinds increased by 2.1% to QR995.7 million, and the net financing cost doubled to QR48.8 million, while the impairment loss of ships and businesses doubled to QR140.2 million. As a result, the net profit increased by 11.1% to QR297.1 million. In terms of comprehensive income, the company achieved profits of QR407.8 million during this period, compared to a loss of QR476.4 million in the corresponding period of 2017. Milaha achieved a comprehensive income of QR704.8 million, versus a comprehensive loss of QR208.6 million in the same period last year.

7-      Qatar First Bank showed a net loss of QR353.87 million in the first half of 2018, compared to a net loss of QR76.67 million in the same period last year, while its loss per share amounted to QR1.77, versus a loss per share of QR0.38 in the corresponding period of 2017. Qatar First Bank's (QFB) total non-banking income decreased by 4.4% to QR173.9 million in the first half of 2018. The bank made a total of QR73.6 million in other revenues, compared to QR42 million in the corresponding period of last year. However, QFB recorded a loss in the fair value of investments amounting to QR290.4 million, versus a loss of QR19.2 million in the corresponding period of 2017. As a result, the total loss amounted to QR38.3 million against a total profit of QR229.4 million recorded last year. After deducting the share of unrestricted investment owners of QR30.9 million, the total loss rose to QR69.1 million, versus a profit of QR184.4 million in the corresponding period of 2017, and after subtracting the total expenses of QR267.6 million, the result is a net loss that has multiplied to QR366.2 million.

8-      Qatar General Insurance Co. net profit amounted to QR54.03 million in the first half of 2018, compared to QR39.69 million for the same period last year, while its earnings per share reached QR0.62, versus QR0.45. General Insurance’s total revenue from insurance underwriting increased by 22.7% to QR47 million in this period, while investments and other income rose by 1.1% to QR133.4 million. On the other hand, the company’s total expenses decreased by 4.1% to QR131.5 million. As a result, the net profit increased by 36.1% to QR54 million, and due to a net profit in the fair value of the assets, the comprehensive income increased to QR66.1 million, compared to a comprehensive loss of QR50.9 million recorded in the corresponding period of 2017.

9-      Doha Insurance Group’s net profit amounted to QR34.9 million in first half of 2018, compared to QR33.9 million for the same period last year, while its earnings per share recorded QR0.70 in, versus QR0.68 for the corresponding period of 2017. The company's total income from insurance revenues increased by 15.5% to QR115.4 million in the first half of 2018. After payment of claims, the net income increased by 9.8% to QR41.2 million. Total investment income and other income increased by 9.8% to QR31.2 million. On the other hand, total expenses increased by 12.8% to QR38.7 million. As a result, the profit attributable to shareholders increased by 2.9% to QR34.9 million. Due to a decline in fair value, comprehensive income decreased to QR26.9 million, however better than the comprehensive loss of QR5.4 million recorded in the corresponding period of 2017.

10-  Salam International Investment Ltd.’s net loss amounted to QR12.65 million in the first half of 2018, compared to a net profit of QR17.74 million for the same period in 2017, and its loss per share reached QR0.11, versus earnings per share of QR0.16 for the same period last year. The total revenue of Salam International from activity and investment decreased by 7.4% to QR332.6 million in the first half of 2018, while its expenses increased by 10% to QR344.5 million, of which QR147 million went to employees’ costs, QR101.3 million for administrative and general expenses, and QR55.3 million as financing costs. As a result, the net profit turned into a net loss of QR12.65 million. There was a limited decline in the fair value, which led to a comprehensive loss of QR13.5 million.

11-  Mannai Corporation’s net profit rises marginally 0.60% to QR167 million, while its earnings per share amounted to QR3.66.

Economic Developments:

1-      Last June, Qatar’s trade balance surplus increased by about QR5.5 or 44.5% compared to June 2017. On a month to month basis, the surplus climbed by about QR3.1 billion, an increase of 21% compared to May 2018, reaching QR18 billion.

2-      Oil prices decreased during trading on Wednesday, due to the pressure of a surprising surge in the United States crude inventories, in addition to the production surge of OPEC oil in the previous month; which raises concerns over global oversupply. Brent crude fell by US $1.82 to US $72.39 a barrel. OPEC oil prices decreased as well by about US $0.77 to the level of US $72.10 per barrel.

3-      Dow Jones declined by about 201 points to the level of 25326 points until closing on Thursday. US dollar stood at $1.16 against the Euro, and against the yen at ¥111.70 per dollar. Gold dropped to the level of US $1213.9 per ounce.