Abu Dhabi finance house posts record profits

21 July 2015

Growth in customer numbers driving returns

  • Dunia Group increases net profits to $36m in first half of 2015, a 51 per cent increase on first half of 2014
  • Dunia Finance profits rose 44.7 per cent over the same period
  • Company’s customer base expanded 24.1 per cent and deposits grew by 65.7 per cent

Abu Dhabi-based Dunia Group has announced record net profits of AED131m ($36m) in the first half of 2015, up 51 per cent on the same period in 2014.

The increase in group profits was driven by Dunia Finance’s first-half 2015 net profits of AED120m, 44.7 per cent higher than the first half of 2014 profits of AED83m.

Dunia Finance, which provides consumer and small-to-medium enterprise financial services, increased its customer base by 24.1 per cent year-on-year to 187,000 by the end of June. Customer deposits increased 65.7 per cent to AED1bn over the same period, allowing the firm’s loanbook to grow 49.3 per cent to AED1.8bn.

The company’s capital adequacy ratio stood at 34.7 per cent at the end of June, significantly higher than the minimum 15 per cent.

This follows a 61.5 per cent year-on-year increase in 2014 profits to AED191m, driven by similar levels of customer growth. This suggests that lower oil prices have yet to affect consumer spending in the UAE.

Dunia Finance’s operating income also rose to AED335m in the first half of 2015, an increase of 48.6 per cent on the first half 2014.

Dunia Services posted a first half 2015 profit of AED12m.

Dunia is 40 per cent owned by Fullerton Financial Holdings, a subsidiary of Singapore’s Temasek Holdings, 31 per cent owned by Abu Dhabi state-owned Mubadala Development Company, 25 per cent by Waha Capital, and 4 per cent by Dubai’s A A al-Moosa Enterprises.

Media reports in May suggested that Mubadala and Temasek may be looking to sell their stakes. Its increasing profits mean it is likely to attract high levels of interest from banks and other investors, including existing shareholders.

“As we have done in the past, we work with our shareholders and our advisers on a regular basis in order to assess all strategic options to support our growth plans and further elevate our performance,” said Dunia in May. “We are currently in the early stages of our latest strategic review process and, as such, no decisions about next steps or potential outcomes have been taken at this time.”

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