At its Annual General Meeting today, the Kuwait Projects Company (KIPCO) announced record profits and predicted that profitability will increase even further in 2006.
At the meeting, KIPCO’s Board of Directors also recommended a cash dividend of 25 per cent (25 fils per share), up from 18 per cent (18 fils per share) in 2004.
KIPCO’s net profit of KD 38 million (US$ 130 million), or 37.20 fils (12.74 cents) per share, for the year ended December 31, 2005, was a 51 per cent increase on the KD 25.24 million profit (US$ 85.64 million), or 25.05 fils (8.5 cents) per share earned in 2004.
The record figures - KIPCO’s 14th year of unbroken profitability – exceeded profit and cash dividend targets set by KIPCO’s managing director and chief executive officer Mr. Faisal Al Ayyar. Speaking at the Annual General Meeting, Mr. Ayyar said:
“This was a record year for KIPCO – in more ways than one. All our operating companies did extremely well in their individual markets and most of our medium and long-term investments are exceeding the rate of return we expected at this stage of their development. All in all, we are extremely pleased with the 2005 results and expect even better results this year.”
During the meeting, Mr. Ayyar said that although the Group’s 2005 results are impressive, they are in line with a consistent trend:
“If you consider KIPCO’s track record over the last three years, then it’s clear our business strategy is working. We’ve increased our share in mature markets and expanded into new markets with exciting ventures. This is an enviable record and I’m confident this momentum of success will continue in 2006.”
“I also think that the commitment we made to be transparent in the way we work with investors, partners and customers is a major factor in our continued success. Next month we will be holding our latest Shafafiyah (Transparency) conference to allow investors to hear how each of our businesses expect to perform in 2006.”
Mr. Ayyar gave some examples of KIPCO’s three year track record:
• In 2005, Burgan Bank delivered a net profit of KD42.4 million, a 108 per cent increase since 2003*. The profit growth has been driven by increased revenues and the introduction of innovative products and services
• Gulf Insurance Company (GIC) posted a net profit of KD7 million in 2005, an increase of 17 per cent* since 2003. During 2005, GIC consolidated its market leadership in Kuwait and expanded its presence in Saudi Arabia, Lebanon and Egypt
• In 2005, United Gulf Bank - the investment banking arm of KIPCO - posted a net profit of KD23.7 million. This was an increase of 50 per cent* since 2003 and the highest profit level in its 26 years of operations
• National Mobile Telecommunications Company (including Wataniya) - one of the world’s fastest growing mobile telecommunications operators – produced a net profit of KD52.8 million in 2005, a 26 per cent* increase since 2003. The total number of subscribers to NMTC companies increased from 800,000 in 2003 to 6.4 million at the end of 2005
*cumulative average growth rate
About KIPCO
KIPCO, with assets of US$ 15 billion under management or control, is one of the leading diversified holding companies in the Middle East and North Africa, and a major regional force in financial services and media & technology with further interests in real estate and industry. KIPCO is the largest private company in Kuwait and employs more than 12,000 people internationally. Its shares are the most actively traded on the Kuwait Stock Exchange.
