Waha Capital, a leading investment company in Abu Dhabi, has reported a net loss of Dh57.8 million ($15.7 million) in the first quarter (Q1) of 2019.

The company’s Asset Management business recorded increased income, while its Private Investments unit recorded a loss due to the revaluation of its investment in AerCap Holdings.  The company posted a total income of Dh189.9 million in Q1.

Waha Capital’s Asset Management business, which manages emerging market fixed income and equity funds, recorded a net profit of Dh151.7 million in the first quarter, an increase of 28 percent from a year earlier. The funds, which have consistently outperformed key indices over several years, continued to deliver strong returns, while assets under management have also increased to Dh2.7 billion.

Meanwhile, the company’s Private Investments business recorded a net loss of 165.7 million in the three-month period, largely due to an adjustment of Dh100 million following a reassessment of the value of AerCap Holding’s recoverable amount. During the period, Waha Capital also recorded a loss on the disposal of 3 million shares in AerCap, as equity price collars on the shares matured and were settled.

Waha Capital benefited from a rise in income at its healthcare investment, Anglo Arabian Healthcare in the first quarter, and invested a further Dh87.5 million in Dunia Finance.

Waleed Al Mokarrab Al Muhairi, chairman of Waha Capital, said: “Waha Capital is implementing a long-term strategic transformation to a highly liquid portfolio of diversified investments that deliver strong cash flows.

“As we transition, the Asset Management division is creating sustained value, by increasing assets under management, and through consistent outperformance by our funds. Our Principal Investments business is focusing on high-growth investments in our areas of expertise, such as financial services and energy. Although short-term market conditions have impacted some investments, notably AerCap, Waha Capital remains in a strong position to deliver sustainable growth and an attractive return on equity in the coming years.”

Michael Raynes, CEO of Waha Capital said: “Waha Capital continues to build a strong business that creates long-term shareholder value through market cycles. In recent quarters, tough global market conditions have affected certain investments, and this has been reflected in the bottom line. However, the fundamentals of the company remain strong.”

“Our equity and fixed income funds have delivered strong returns in the first quarter, building further on outstanding multi-year track records of outperformance, and we continue to attract institutional third-party investors. The Private Investments business is well diversified, and we plan to recycle capital into new high-potential investments. The senior leadership team at Waha Capital remains focused on prudent financial management and pursuing new growth opportunities in the coming years,” he added.

Asset Management highlights

The year-to-date returns of the funds, attributable to owners, as of the end of March was 9.22 per cent for the Mena Equity Fund, 11.36 per cent for the Mena Value Fund, and 7.56 per cent for the CEEMEA Fixed Income Fund. Total assets under management increased to Dh2.7 billion at the end of the first quarter, from Dh2.5 billion at the end of the fourth quarter of 2018.

Private investments highlights

AerCap

In the first quarter, Waha Capital disposed 3 million Aercap shares equivalent to a 2.1 per cent stake in the company for a consideration of Dh490 million. During the period, AerCap carried out a share buyback programme, which Waha Capital did not participate in. Waha Capital’s stake in the company stood at 10.3 per cent at the end of March, down from 12 per cent at the end of December 2018.

Petronash

In the first quarter, oil and gas services firm Petronash recorded a rise in revenue to US$36 million, with EBITDA (earnings before interest, tax, depreciation and amortisation) of US$5.4 million. Waha Capital acquired a 35 per cent stake in Petronash in August 2018, with an option to increase its stake to 50 per cent.  
    
Channel VAS

Dubai-based fintech firm Channel VAS, in which Waha Capital holds a 19.5 per cent stake, reported a year-on-year increase in revenue of 29.8 per cent to Dh55 million.  The company, which is a premium provider of fintech solutions for mobile network operators, is present in over 25 countries, with access to over 500 million mobile subscribers.

Anglo Arabian Healthcare

Anglo Arabian Healthcare, in which Waha Capital owns a 95 per cent stake, reported a 21.9  per cent increase in consolidated revenue to Dh78.9 million in the first quarter. The company owns and operates 27 business assets, employing more than 900 people and serving over 800,000 patients. – TradeArabia news Service