Doha: Aamal Company, one of the Gulf region’s leading diversified companies, has reported a net profit of QR90.6m for the nine-months period ended September 30, 2020, a decrease by 65.1 percent compared to QR259.6m posted during the third quarter of last year.
Aamal’s total revenue increased by 2.8 percent to QR972.0m during the period from QR945.3m during the third quarter of 2019. Gross profit decreased by 28.1 percent to QR242.3m from QR337.1m during the same period last year.
The company’s share in results of associates and joint ventures accounted for using the equity method decreased by 7.6 percent to QR43.8m, compared to QR47.3m during the third quarter of 2019. While net profit attributable to equity holders of Aamal decreased by 64.5 percent to QR91.6m, compared to QR257.8m during the same period last year.
Capital expenditure increased by 4.6 percent to QR33.8m, compared to QR32.3m in the third quarter of last year, mainly due to renovation works in the Property segment. Gearing remains low at 2.75 percent.
Reported earnings per share was down by 64.5 percent at QR0.01, compared to QR0.04 during the third quarter of last year.
Chairman of Aamal, Sheikh Faisal bin Qassim Al Thani, said: “While Aamal’s operating and financial performance continued to be impacted by the ongoing COVID-19 pandemic throughout the third quarter of 2020, signs of recovery are beginning to emerge. Despite the challenging market conditions presented by COVID-19 and strong competition, the Trading and Distribution segment delivered a commendable performance with revenue and net profit up by 26 percent and 18 percent, respectively. This is largely attributable to Ebn Sina Medical, which recorded a significant increase in orders”.
Sheikh Faisal reiterated that the company’s Industrial Manufacturing segment is seeing signs of improvement in the levels of project activity as Qatar prepares to host the FIFA World Cup 2022. Aamal Cables won a major three-year contract with Kahramaa, the sole transmission and distribution system owner and operator for the electricity and water segments in Qatar, to supply 11KV medium voltage and pilot power cables. This significant contract, worth QR694m over three years, demonstrates the company's strong competitive positioning in the sector, said Sheikh Faisal.
He added that the Industrial Manufacturing segment recorded top line growth of 23.8 percent year-on-year driven by new contract wins, although pricing and margins remained under pressure from continuing acute competition at Aamal Readymix. In response, the company continues to focus on improving operational efficiency, optimising its production base and diversifying into new revenue streams.
“The performance of the Property segment continued to be impacted by the waiving of rents for commercial tenants at both City Center Doha and Souk Al Harraj, a decision we took in order to support our tenants during these challenging times. While most of City Center Doha has now reopened following its closure due to COVID-19, Aamal has continued to provide financial support to tenants throughout the third quarter while footfall recovers.
“Finally, in the Managed Services segment, Aamal Services has been impacted by reduced demand for hospitality and facilities management services, whilst other businesses such as Fun City and Winter Wonderland remained closed as a result of COVID-related restrictions imposed by the Qatari government,” Sheikh Faisal added.
Chief Executive Officer and Managing Director of Aamal, Sheikh Mohamed bin Faisal Al Thani
Chief Executive Officer and Managing Director of Aamal, Sheikh Mohamed bin Faisal Al Thani, said: “Throughout the third quarter, Aamal’s Board of Directors and management team have remained focused on navigating a uniquely challenging environment, preserving the strength of our balance sheet and ensuring Aamal remains well positioned for the future by implementing operational improvements across the Group. As a result, we have again withstood the impacts of pandemic in the quarter, remaining profitable, delivering topline growth and keeping our gearing low while increasing capital investment”.
He added that to support the ongoing development of the Group, the Property segment has commenced the development of the frontage at City Center Doha, which will see the launch of new outdoor cafes and restaurants as well as landscaping. Aamal Real Estate has also commenced renovation of several buildings and compounds to improve its offering in the real estate market. The company also implemented a number of operational improvements, including a review of sales and pricing policies to drive competitiveness and improve efficiency at Aamal Readymix.
Sheikh Mohamed added: “Throughout the pandemic, our top priority has been to provide a safe and supportive working environment for all of Aamal’s employees. The Board of Directors would like to once again thank all employees for their unwavering dedication during this exceptionally challenging period.
“We expect conditions to remain challenging throughout the remainder of 2020 as uncertainty prevails around the COVID-19 pandemic, its progression, severity and duration. Notwithstanding the uncertainty in global markets, in the longer term there are significant opportunities across all four of Aamal’s segments. We remain confident that the diversification of our business model and the strength of our balance sheet will ensure the Group remains well-positioned to grasp opportunities as the market recovers”.
Sheikh Mohamed also reiterated that since the start of the fourth quarter of this year, Aamal has been included in the QE Index which comprises the twenty most liquid and largest listed companies on the Qatar Stock Exchange by free float market capitalisation. “As the benchmark index for the Exchange, we welcome the additional investment profile that inclusion in the QE Index will bring,” he added.
Aamal will hold a conference call to discuss the company’s financial results on November 2 at 2pm.
SOURCE: THEPENINSULAQATAR