Shuaa Capital, a leading asset management platform, has achieved a 10-year record in quarterly profits, with net profit attributable to shareholders for Q1 2021, of AED25 million ($6.8 million) compared with AED262 million net loss attributable to shareholders in Q1 2020.

The company’s operating income increased 132% year-on-year from AED19 million in Q1 2020 to AED45 million in Q1 2021. EBITDA generation also remained strong, at AED75 million for Q1 2021 compared with a negative EBITDA of AED202 million in Q1 2020, up AED277 million year-on-year.

Furthermore, revenues saw an increase to AED102 million in Q1 2021 compared with AED72 million in Q1 2020, up 42% year-on-year driven by our recurring business which continues to trend above the average of the last four quarters, despite Q1 traditionally being Shuaa's quietest quarter.

Although this is against a weaker 2020 comparative, as Q1 2020 saw the early effects of the global pandemic, these results represent the fourth consecutive quarter of profitability for the Group despite the continued impact of COVID-19 on the economic landscape, demonstrating the resilience of Shuaa’s diversified platform.

The solid underlying performance also saw Shuaa achieve record profits for its Asset Management business. This was despite a slight decrease in assets under management to $13.9 billion compared with the record levels of $14.1 billion reached at the end of FY 2020, due to the exit of a low margin mandate. Conversely, the company has achieved continued progress on building out the new funds recently launched.

Both Shuaa’s Asset Management and Investment Banking businesses achieved a strong start to the year, underpinned by several landmark transactions in the first quarter despite some delays to transactions.

Shuaa’s asset management segment continues to make progress on its previously communicated strategic agenda with regards to the build-up of permanent capital posting record profits of AED35 million. Two of the Group’s permanent capital vehicles launched under the Incorporated Cell Company (ICC) platform in Q4 2020 announced their first dividends in January 2021. This is testament to the funds’ early performance, representing an annualized yield of 6.4%, and highlights Shuaa’s ability to create significant value for its investors. Building on this positive momentum the ICC Funds platform expects to launch three additional funds to expand its offering.

In January, Shuaa announced its funds’ investment in Anghami, the leading music streaming platform in the Mena region, and this was followed by the news in March that Anghami will become the first Arab tech company to list on NASDAQ New York via its proposed merger with Vistas Media Acquisition Company (VMAC).

The transaction implies an initial pro-forma enterprise valuation of approximately $220 million and is expected to close in Q2 2021. The holding is not only aligned with Shuaa's stringent investment criteria and has Shuaa's Investment Banking team acting as global financial advisor and underwriter for the deal PIPE, but also supports the company's interests in pursuing technology investments.

Looking ahead, Shuaa is poised for growth this year, thanks to the enhanced value proposition post-integration and a healthy pipeline of deals as well as innovative new fund launches that will enhance recurring revenues going forward. The Group therefore remains well placed to deliver on its growth strategy and create long-term sustainable value for its investors and shareholders.

Jassim Alseddiqi, Group Chief Executive Officer of Shuaa Capital, said: “We have further solidified our platform and have successfully concluded our merger integration program. Our focus now shifts onto growth and transformation with significant hiring across the platform, new product launches and differentiated value propositions for our clients. With Q1 profits having hit a 10-year high, the landmark transactions and the momentum we are currently seeing across the firm going into Q2 have both been very encouraging and reinforce our commitment to the continued execution of our strategic agenda.” – TradeArabia News Service