APICORP records net profit of $70.4mn for H1-2019

APICORP records net profit of $70.4mn for H1-2019
Published: 2 September 2019 - 5 a.m.
By: Martin Menachery
Arab Petroleum Investments Corporation (APICORP), a multilateral development financial institution, announced its half-year results for the six months ended 30 June 2019. According to the results, gross operating income for the period stood at $184.1mn, while net profit reached $70.4mn. Compared to the same period last year, these results represent an improvement of 30% and 10% in the corporation’s recurring income, respectively.

The primary drivers for the increase in revenue were the company’s corporate finance and treasury business lines, which grew by 44% and 78%, respectively. Moreover, the company’s efficiency ratio improved to 22.3% for the period, down from 27.4% for the 2018 financial year.

Over the period, APICORP’s balance sheet grew 6.2% to reach $7.4bn as a result of the growth in the size of its corporate finance and treasury portfolios, which was funded by an increase in owners’ equity and boosting external funding sources through several funding transactions. These transactions saw maturity beyond two years now comprising 40% of the company’s total liabilities and shareholders’ equity, up from 33% in December 2018.

Excluding the $86.7mn from the sale of its equity stake in National Petroleum Services (NPS), APICORP’s gross operating income improved comparatively by 30% in the first half of 2019 compared to the same period in 2018.

Commenting on the announcement, Dr Ahmed Ali Attiga, CEO, APICORP, said: “Our results for the first half of 2019 affirm the effectiveness of APICORP’s business strategy in diversifying its business and related activities in addition to expanding its partner base. We improved our recurring income in gross operating income and net income compared to the same period last year. Despite challenging market conditions, we also successfully completed six medium-term funding transactions worth $1.4bn from international markets.

“These achievements speak to the strength of our position as a trusted financial partner to the region’s energy industry. Looking ahead, we remain committed to exploring new opportunities and providing our partners with innovative solutions, which support their development goals, all while continuing to spearhead the energy industry’s rapidly evolving reinvention and transformation through projects that emphasise sustainable, socially responsible development.”

Dr Sherif Ayoub, chief financial officer, APICORP, said: “APICORP’s strong financial performance continued during the first half of the year. This is in the face of a number of uncertainties that emerged at the global and regional markets during the same period, thereby confirming the resilience of APICORP in generating increasing profitability.”

In addition to the improving recurring net income, the corporation also enhanced its profitability ratios with the annualised ROA and ROE standing at 1.9% and 6%, respectively. Notably, our risk profile remains robust, with capital adequacy maintained at the 28% range and liquidity and funding showing marked improvements.”

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