KIPCO - the Kuwait Projects Company- has announced a record net profit of KD 50.1 million (US$ 173.2 million), or 48.51 fils (16.8 cents) per share, for the year ended December 31, 2006, a 32 per cent increase compared to the KD 38 million (US$ 130.2 million) or 37.20 fils (12.74 cents) earned per share in 2005.
The Board has recommended a cash dividend of 30 per cent (30 fils per share) for 2006, up from 25 per cent (25 fils per share) in 2005.
KIPCO, with substantial interests in 54 companies operating in sectors such as financial services and media & telecommunications across the Middle East and North Africa region, also posted a 28 per cent rise in total consolidated assets, up to KD 1,359 million (US$ 4.7 billion) from KD 1,064 million (US$ 3.6 billion) in 2005. Total revenue was up 35 per cent to KD 160 million (US$ 552 million) during 2006, compared to KD 119 million (US$ 406 million) in 2005.
During 2006, the market value of KIPCO’s investments in core listed subsidiaries and associated companies rose by KD 71 million (US$ 245.5 million), an increase of 12 per cent from KD 593 million (US$ 2.03 billion) in 2005, to KD 664 million (US$ 2.3 billion) at the end of 2006.
KIPCO’s success was underpinned by record-breaking performances from each of the Group’s core companies: in 2006, United Gulf Bank achieved earnings of KD 29.3 million (US$ 101 million) a jump of 24 per cent over the previous year; Gulf Insurance Company’s net profit grew 20 per cent to KD 8.4 million (US$ 29 million); Burgan Bank’s net profit rose 32 per cent to KD 55.7 million (US$ 192.7 million); and Wataniya Telecom’s net profit increased 39 per cent to KD 73.2 million (US$ 253 million).
The 2006 results - KIPCO’s 15th year of consecutive profitability – exceeded the profit and cash dividend targets set by KIPCO’s Managing Director and Chief Executive Officer Mr Faisal Al Ayyar at the company’s third annual KIPCO ‘Shafafiyah’ (Transparency) Forum held in May, 2006. Commenting on the 2006 results, Mr Al Ayyar said:
“2006 was another record year for all our main operating companies and therefore another record year for KIPCO. Our financial services companies and our telecommunications operations did particularly well. We are also very proud that each of our core companies exceeded the earnings forecasts they announced at our 2006 Shafafiyah Forum. This was the third year running that our companies have presented and then beaten the forecasts they made for the year. This clearly shows the strength of our budget and business planning and that our companies are being managed by some very determined and professional teams,” he said.
Mr Al Ayyar said that this year’s Shafafiyah programme has been designed to improve communication between KIPCO and its shareholders, analysts and partners:
“For each of the last three years our Shafafiyah programme has been a great success, but each year we aim to improve the delivery of our performance forecasts. So, this year we have decided to present the earnings forecast for each of our core companies after their General Assembly meeting. By doing this, investors will be able to put relevant questions to their management teams in the context of the 2006 results. The Shafafiyah 2007 programme will begin on Saturday, March 17th and we will be announcing further details within the next few days,” he said.
KIPCO launched its Shafafiyah programme in 2004 to present the financial forecasts of its core listed group companies to key financial audiences and create a two-way dialogue between KIPCO and its investors.