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: UAE Free Zones Newsletter - Issue 51 -
January 2008 |
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UAE firms set to post strong results
UAE-based companies, particularly banks and financial services firms, are expected to announce stellar performance for the full year on the back of strong fourth-quarter results, according to forecasts by EFG-Hermes, a regional investment bank.
A few results such as the annual financial performance of Amlak and Dubai Financial Market are out. A vast majority of companies are expected to announce their financials during the next two weeks.
Analysts from EFG-Hermes said banks and financial services will continue to deliver positive results barring a few exceptions.
"Commercial Bank of Dubai, one of our top picks in the sector, is expected to deliver the highest earnings growth of the sector at 53 per cent year on year for the quarter and 49 per cent for the full year. We believe the bank will continue to profit from their strategy of targeting the SME segment.
In addition, we expect to see a pickup in mortgage finance income subsequent to the release of their mortgage product in 2007," said Fahd Eqbal and Hanzada Nessim, analysts from EFG-Hermes in their earnings forecast note.
Dubai Islamic Bank is projected to deliver a weak quarter, with earnings expected to fall two per cent year on year in the fourth quarter, however, the net profits for the full year is expected to be up by 65 per cent form last year.
Among the Dubai-based banks, analysts expect Emirates NBD to deliver 17 per cent year-on-year earnings growth for the quarter and 19 per cent for the full year driven by non-interest income, which was hit by trading losses last quarter.
While Abu Dhabi Commercial Bank is expected to report a marginal fall in earnings year on year, forecasts for the other leading banks such as Abu Dhabi Islamic Bank (ADIB) and National Bank of Abu Dhabi (NBAD) are relatively muted.
ADIB is expected to report a 16 per cent growth in earnings for the full year, NBAD is expected to report earnings growth of 14 per cent year on year while First Gulf Bank is expected to deliver strong results with 25 per cent increase in earning this year.
Islamic mortgage lender Tamweel is expected to report 172 per cent growth in earnings for the full year excluding last year's IPO proceeds driven by strong mortgage origination and an increase in property income, which is beginning to account for a significant portion of total revenues.
Among the newly listed firms, Air Arabia is expected to report robust earnings while Tabreed is likely to deliver modest growth.
CBD could steal limelight
Commercial Bank of Dubai (CBD), is expected to deliver the highest earnings growth of the sector at 53 per cent year on year for the quarter and 49 per cent for the full year.
Dubai Islamic Bank is projected to fall 2 per cent year on year in the fourth quarter but the net profits for the full year is expected to be up by 65 per cent.
Emirates NBD to deliver 17 per cent year-on-year earnings growth for the quarter and 19 per cent for the full year. |
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Courtesy Al Nisr Publishing LLC
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