IHC Presents Strong H1 2023 Operational and Financial Results

International Holding Company (ADX:IHC), the global diversified Abu Dhabi-based conglomerate, unveiled its financial results for the second quarter and half year of 2023,  registering a group net profit of AED 10.4 billion, accompanied by net profit margin of 36.3%. This commendable performance underscores the company's unwavering dedication to executing its strategic vision and delivering enhanced shareholder value.

In 2023, IHC has effectively sustained its growth trajectory, exemplified by an impressive revenue surge of 30.8% compared to H1 2022, culminating in a remarkable AED 28.7 billion for the first half of the year. This commendable performance can be attributed to the exceptional quality and resilience of IHC's assets, particularly in the marine and dredging, real estate, and financial services segments, which have significantly contributed to this substantial growth.

By capitalizing on the strength of its asset portfolio, IHC has not only achieved greater value for its shareholders but has also played a pivotal role in advancing the UAE's ambitious economic transformation goals. As a key player in the region's business landscape, IHC continues to drive progress and contribute significantly to the nation's overall economic development.

"The results confirm that we are on the right track towards the goals we set for ourselves last December. IHC Q2 and H1 2023 results have lived up to our expectations, and I am thrilled to see that our cash position remains robust. Our unwavering commitment to pursuit of greater operating efficiencies across every aspect of our business has contributed to this positive outcome. Encouraging progress on reducing fixed and variable costs earlier in the year supported our adjusted EBITDA guidance for the year.” said Syed Basar Shueb, IHC’s Chief Executive Officer commenting on the result.

- IHC Demonstrates Remarkable Growth in Key Segments and Bolsters Financial

Position in H1 2023

In H1 2023, International Holding Company (IHC) witnessed significant growth in its marine and dredging segment, attributed to the successful acquisition of large long-term agreements from industry giants ADNOC and Aramco by NMDC. The consolidation of Aldar since Q2 2022 played a pivotal role in bolstering the real estate segment's expansion. Additionally, the strategic acquisition of National Health Insurance (Daman) in October 2022 has notably boosted the financial services segment.

Despite prevailing challenging global macroeconomic conditions, IHC has continued to fortify its balance sheet, reporting a robust total asset position of AED 229.6 billion, marking a remarkable 40.3% increase compared to H1 2022. This achievement underscores the company's resilience and strategic acumen in navigating dynamic market conditions while ensuring steadfast growth. Moreover, total owner's equity demonstrated extraordinary growth, surging by 233.3% to AED 75.1 billion over H1 2022, solidifying IHC's unwavering commitment to delivering value to its esteemed shareholders.

As a forward-thinking organization, IHC remains steadfast in its commitment to Environmental, Social, and Governance (ESG) principles, with a proactive approach to sustainability. Transparency, clarity, and accountability form the foundation of IHC's latest initiatives, including "proseed" and the ambitious net-zero emission targets set by its portfolio companies. These initiatives reflect IHC's dedication to driving sustainable practices and making a positive impact in the communities it serves.

IHC's exemplary growth trajectory and steadfast focus on ESG values reaffirm its position as a leading force in the global business landscape, poised for continued success and positive contributions to its stakeholders and the wider society.                                                                                                                                       

- IHC’s Second Quarter Summary 2023

-          Aldar Properties PJSC acquired a 75% stake in Basatin Holding for a consideration of c.AED 139 million.

-          Alpha Dhabi Hospitality LLC acquired a 51% stake in ADMO Lifestyle Holding Ltd. for a consideration of AED 716.5 million.

-          Emirates Stallions Group acquired 23.9% stake in Kizad Communities Development and Services Company LLC.

-          Alpha Dhabi acquired 36.4% stake in National Corporation for Tourism and Hotels for a consideration of AED 730 million.

-          Al Seer Marine made a cornerstone investment of AED 257 million into ADNOC Logistics & Services.

Economic Outlook

While the outlook is uncertain again amid financial sector turmoil, high inflation, ongoing effects of global geopolitical conflicts, adding to the complexity, the world has grappled with the lasting effects of the COVID-19 pandemic over the past three years. The UAE economy is poised for stronger growth, recovery, and prosperity in the second half of this year, supported by a track record of economic successes that have fructified into the UAE’s. The UAE economy’s strength and recovery from the aftermath of the Covid-19 pandemic are evident in the positive projections made by international institutions and banks including the International Monetary Fund (IMF) and World Bank as the country is poised for positive economic growth as it is projected to achieve a 3.6% increase in its gross domestic product this year, driven by robust domestic activity. 

"The supply-chain disruptions and rising geopolitical tensions have brought the risks and potential benefits and costs of geoeconomic fragmentation to the center of the policy debate, and this has reshaped the geography of foreign direct investment (FDI) for many organizations, including IHC, impacting the global economy." said Shueb.

Amidst the current global economic slowdown and potential risks, the global equities markets are anticipated to navigate a delicate balance. As long as the global economy maintains its stability and avoids drastic downturns, and the pace of disinflation restrains interest rates and subsequently, equity performance, investors will remain cautious. In response to the prevailing slower economic backdrop, IHC's strategy inclines towards more domestic business acquisitions, leveraging the UAE's stable economic environment, investor-friendly government policies, strategic location, tax incentives, and diverse property market. This approach aims to safeguard investment positions during these uncertain times.

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