Waha Capital H1 2023 net profit up 221% year-on-year to AED 318 million

ABU DHABI, 29th July, 2023 (WAM) --  Waha Capital PJSC, an Abu Dhabi-listed investment management company (ADX: WAHA), reported a 221% increase in net profit year-on-year to AED 318 million for H1 2023 - equating to a return on equity of 12.6% - driven by healthy returns from its capital markets funds and higher fee income from managing third-party assets.  

The company recorded total operating income of AED 500 million in the first six months of 2023, an increase of 123% from AED 224 million a year earlier. Income growth was primarily driven by the strong performance of Waha Investment, a wholly owned asset management subsidiary, as its emerging markets funds continued to deliver considerable returns and attract significant capital.

While the company has maintained strong cost discipline, operating expenses have increased due to performance-based incentive compensation accruals, which have risen in line with investment results. Higher benchmark interest rates have contributed to an increase in finance costs to AED 61 million from AED 54 million a year earlier.

For the second quarter, Waha Capital reported total income of AED 259 million and net profit of AED 170 million. Waha Capital’s total assets under management (AUM) stood at AED 9.0 billion at the end of June 2023, versus AED 6.3 billion a year earlier. 

Waha Investment, the capital markets business that actively manages emerging markets funds, achieved AED 481 million in net investment returns in the first half of 2023, while fee income from managing third-party capital almost doubled year-on-year to AED 46 million. The business reported net profit of AED 458 million, compared to AED 113 million a year earlier.  

The company’s flagship credit and equity funds produced positive returns in the face of continued volatility in global markets, continuing their exceptional multi-year track record of outperformance. 
The Waha MENA Equity Fund achieved a total return of 10.5% versus 5.4% by its benchmark in the first six months of the year. The fund has delivered a cumulative return of 321.4% since its inception in January 2014, versus the S&P Pan Arab Composite Index’s return of 62.9%. 

The Waha Emerging Markets Credit Fund, which pursues diverse long-short strategies in emerging markets fixed income, recorded a total return of 3.8%, compared to 4.1% for its benchmark. The fund has delivered a cumulative return of 189.2% since its inception in 2012, versus the JPMorgan EMBI Global Diversified Index return of 45.0%. 

The Waha Islamic Income Fund delivered a total return of 3.78% (gross of fees) versus a benchmark return of 2.03%. The fund, which mainly invests in global sukuk and Shari’ah-compliant equities, has recorded a cumulative return of 19.4% (gross of fees) since its inception in August 2020, versus a -3.1% return by the Dow Jones Sukuk Index. 

Waha Land, a wholly-owned subsidiary that develops, owns, and operates light industrial real estate assets, recorded total revenue of AED 23 million in the first six months of 2023, driven by steady rental income

 

  Waleed Al Mokarrab Al Muhairi, Chairman, said:''  Waha Capital performed strongly in the first half of 2023, generating net profit of AED 318 million and a return on average equity of 12.6%. Despite challenging macroeconomic conditions, the emerging markets funds managed by Waha Investment have delivered positive returns, further extending their multi-year track record of outperformance. This has resulted in inflows of AED 2.1 billion in third-party capital, which has contributed significantly to the company’s fee income.

The Private Investments business remains strong and stable as it pursues a flexible, opportunistic approach. The team’s global opportunities strategy and active management of Waha Capital’s direct investments have been instrumental in creating long-term value for stakeholders.''
 
  Mohamed Hussain Al Nowais, Managing Director, : ‘’ I am pleased to report that Waha Capital achieved a solid performance in the first six months of this year, demonstrating the company’s resilience and financial position. Our investment teams have continued to create value while managing risk amid heightened uncertainty in global markets. Our flagship emerging markets credit and equity funds have continued to deliver exceptional returns to the company and our clients. We are attracting a high level of interest among regional institutional investors and family offices, which is translating into substantial capital commitments. Assets under management now exceed US$2 billion, with third-party assets accounting for 57% of this total.''