KUWAIT: In a meeting of its board members on 10 November 2020, Boursa Kuwait announced profits of KD 22.6 million for the nine month period ended 30 September 2020, an increase of 231 percent compared to the same period in 2019, when the company recorded a profit of KD 6.8 million.
The company generated 108.6 fils earnings per share, which is attributable to the equity holders of the parent company and an increase of 214 percent compared to its total of 34.6 fils over the same period in 2019, while the company’s total assets came in at approximately KD 99.3 million, which is a 178.4 percent increase versus its 2019 total for the same period of KD 35.7 million. Shareholder equity increased from KD 29 million in September 2019 to KD 48.9 million for the period ended 30 September 2020, attributable to the equity holders of the parent company and an increase of 66.5 percent.
Total operating revenue came in at KD 13.2 million, an increase of 25.9 percent over the same period in 2019, when the total operating revenue for the nine month period was approximately KD 10.5 million, while total operating expenses were KD 6.1 million, an increase of 11.4 percent over the same period’s 2019 total of KD 5.47 million.
Boursa Kuwait Chairman Hamad Meshari Al-Humaidhi commented: “We are pleased to have recorded profits of KD 22.6 million, an increase of 231 percent compared to its 2019 total over the same period. The results we see today mirror the strength of the operational model and the solid strategy in place, as well as the company’s underlying strong financial health, which have allowed us to deliver an exceptional performance. Building on these results, we look forward to the further diversification of our operations and investments.”
Boursa Kuwait aims to develop a strong financial market with high liquidity and credibility through the implementation of a range of structural and technical developments and initiatives that will enhance the position of the exchange, regionally and globally. Boursa Kuwait continues to implement many steps in accordance with international practices and standards to transform Kuwait into a regional and global investment destination, by focusing on creating an attractive issuer base and broadening its investor base, increasing the depth and breadth of its products, as well as upgrading its infrastructure and business environment to international standards.
Al-Humaidhi added: “The listing of Boursa Kuwait on the Kuwaiti capital market is a landmark achievement for the company and is in line with its overarching strategy to develop itself into a prominent regional exchange and a model of success for other companies, whether they are currently listed or looking to list in the future.”
Boursa Kuwait recently listed its shares on the country’s financial market, seeing its shares reach ten times its IPO price on its stellar trading debut on September 14, 2020. The company also increased its share in the Kuwait Clearing Company on July 19, 2020, when it signed an agreement with a third party to acquire 33.375 million additional shares for a total consideration of around KD 15 million, increasing its ownership to 50 percent.
The increase in net profit is due to the increase in the net operating profit of Boursa Kuwait as a result of its operational performance. Furthermore, and consequent to the acquisition of Kuwait Clearing Company (KCC) and the change of its ownership from an associate to a subsidiary, there was a consolidation of KCC’s financials in Q3 2020, and a remeasurement of the previously held investment in KCC of 33.33 percent at fair value and to recognize either profit / loss resulting therefrom as per the IFRS. It is worth noting that the nature of the gain in relation to the remeasurement is non-recurring.
Mohammed Saud Al-Osaimi, Boursa Kuwait’s Chief Executive Officer commented on the company’s quarterly financials, saying: “This quarter’s results show that the company enjoys a great deal of investor confidence as well as demonstrating the ongoing value and efficiency of the company, and that Boursa Kuwait leads a progressive operation in line with world-class standards and best practices with ample room for growth and expansion.”
“We have also began exploring other areas of growth, specifically in the acquisition of even more shares in the Kuwait Clearing Company, which will undoubtedly help streamline the investment processes for all market participants, especially with the upcoming inclusion in the MSCI Emerging Markets index.”
Boursa Kuwait and the Kuwait Clearing Company recently introduced a series of temporary and permanent measures in preparation for the MSCI Emerging Markets inclusion date. These measures included an extension of the Closing Auction and Trade At Last sessions on the day of inclusion, as well as the introduction of allocation accounts (ACM). It is expected that a further change, the removal of the fresh money rule (Netting) on an investor level, will also be introduced at a later date by the Kuwait Clearing Company.
Since its inception, Boursa Kuwait has worked diligently to create a credible exchange built on efficiency and transparency, creating a liquid capital market, a progressive exchange platform and developing a comprehensive set of reforms and enhancements that has allowed it to compete on an international level. Over the past three years, the company has rolled out numerous market reforms and new initiatives as part of its comprehensive multi-phase market development (MD) plans.