KUWAIT: Chairman of the board of Al-Safat Investment Company Abdullah Hamad AlTerkait said the company is interested in following the approved plan that concentrates on restructuring the company’s investments and assets as well as its subsidiaries in the coming period.
AlTerkait, who spoke on the sidelines of the general assembly that was held recently with 66.1% attendance, said the company is looking for opportunities that agree with its strategy according to low-risk rates while at the same time concentrating on strong opportunities, particularly in operational sectors of real estate.
Exits and liquidity
AlTerkait said Al-Safat made several exits during the past period that contributed to having liquidity that was directed towards various investments to achieve regular cash flows for the entity in general, which had a major effect on the company’s stability.He said the company became profitable and maintained its positive performance for the third consecutive year after suffering for many years, as the board of directors and the executive administration cooperated with courageous decisions and steps to safeguard shareholder rights and develop company resources despite facing challenges.
AlTerkait added the company is now on the threshold of a new stage that is expected to see many developments that will have positive returns. He said the board of directors intends to discuss relisting the company on Boursa Kuwait after doing away with all the problems that burdened Al-Safat before the current administration took over, pointing out the company went through years of weakness that needed extreme joint efforts to overcome.
AlTerkait said, “Al-Safat Investment Company underwent comprehensive restructuring and instilled the institutional aspect in all its business with clear goals.” He said that with the efforts and work of the company’s board of directors and the executive as well as the work team, the company’s direction and performance improved. He added the Al-Safat Company administration implemented an ambitious work plan and a new strategy through concentrating on integral strategic sectors to achieve sustainable growth for its business and hasten the growth pace within the company through taking investment opportunities to achieve the highest growth rates.
The company’s focus
AlTerkait said there is an interest in upgrading internal policies and procedures in the company and building an outstanding administrative team of experienced youth to face challenges of the coming period. He said the company focus was on increasing revenues, improving liquidity rates and preserving the company’s financial status, as well as strengthening company assets through concentrating on income-generating operational investments, while at the same time reducing company expenditure within the framework of the strategic plan that was prepared by the board of directors. He said Al-Safat Investment Company continued to instill transparency, governance and internal supervision systems, that in turn led to enhancing the institutional work for the implementation of the Capital Markets Authority’s and supervisory bodies’ requirements.
Concerning the company’s compliance with the rules of companies’ governance that are related to guaranteeing the accuracy of financial reports, AlTerkait affirmed the accuracy of the financial data for 2017 and reports related to the company activity, which is handed to external auditors. As for incentives of the board of directors during the year 2017, he said board members did not receive any financial incentives, salaries or allowances for attending committees meetings.
AlTerkait reviewed the company’s financial performance during the financial year ending Dec 31, 2017,explaining that Al-Safat investment closed its 2017 financial year by making a profit for the third consecutive year, as it made profits of KD1,028,125 for the year ending Dec 2017, which is 4.01 fils per share compared to a profit of KD844,357 at 3.29 fils per share for the year ending Dec 2016. He said the total assets of the group as of Dec 31, 2017 is KD 56.9 million, compared to KD60.2 as of Dec 31, 2016, while shareholders’ rights for the mother company reached KD22.9 million and the book value is 89.5 fils per share. About the group’s dues as of Dec 31, 2017, he said they are estimated at KD25.4 million compared to KD24 million as of Dec 31, 2016.
AlTerkait said, “You realize the size of difficulties the investment sector is suffering from and is still facing including a relative drop in liquidity.” He pointed to the market fluctuations in the region as the region’s economies are linked with the fluctuations of international markets and the political situations that are still sweeping the region, and out of fear of an economic recession.
About the direct investments Al-Safat is involved in and the returns from them, AlTerkait said the company is looking forward to taking income-generating operational investment opportunities that are well studied and expected to achieve an additional value and synergy with subsidiary companies, bearing in mind the ideal geographical distribution.
He pointed to the continuity of the investment of the company’s direct portfolio with influential and strategic shares in several operational companies in the financial, industrial, health, real estate, oil, food and education sectors, as the volume of the direct investment portfolio reached over $190 million.
He said the local company assets reached 80% of the total assets value. The direct investments portfolio contributes with 85% of the total annual company revenues, in addition to the company currently developing some service projects directly in the logistics services sector through subsidiary companies.
AlTerkait said: “The company acquired some foreign strategic investments such as an influential share in one of the largest holding investment companies in Abu Dhabi as far as the capital and asset volume are concerned, a majority share in a brokerage company in Egypt and a tourist hotel in Al-Mahatta area of Bhamdoun in Lebanon.
He said the working team in the company was able to achieve rewarding exits in several sectors in favor of the mother company and its subsidiaries, the latest of which is negotiating an exit from an industrial asset in the kingdom of Bahrain at a value of $3 million.He said there were several acquisitions to increase the group’s share in the industrial sector through direct ownerships in companies operating in packaging industries, in addition to carpets and chemicals. He said some investments were directed to companies in the oil and real estate companies, with a total investment of $10 million during 2017.
Where do opportunities lie?
There are many various investment opportunities outside Kuwait and the decision to explore these opportunities goes back to each company’s direction in the mechanism of diversifying and distributing its investments and risk appetite, the expected returns and short or long term profitability.
Thanks and appreciation
AlTerkait addressed shareholders by saying: “I, on behalf of board members, thank you for the confidence you put in us, which is the best support for us and has the great effect in keeping us continuing our successful march.” He also thanked board members and the executive administration as well as company employees who did not spare any effort in order to enhance the company’s performance.
AlTerkait lauded the role of the Commerce and Industry ministry, Capital Markets Authority and the Central Bank of Kuwait for their keenness on achieving the sought after benefits and protecting the rights of shareholders through the application of the best standards and international practices, which in turn revives the investment and economic sector in Kuwait. The general assembly approved all the items on the agenda including the board of directors, auditors and the sharia supervisory authority reports.