Al Ansari profit falls 16% as remittance takes a hit

UAE remittance and foreign exchange house Al Ansari Financial Services reported a 16 percent year on year decline in profit due to a drop in the remittance segment and increased expenses.

The company reported a net profit of AED495 million for 2023, hoping the newly announced remittance fee hike will help offset costs and strengthen the balance sheet.

Headwinds in major markets such as India, Egypt and Pakistan caused an eight percent drop in remittance operating income. However, strong diversification drove an overall nine percent increase in non-remittance operating income, mainly mitigating the decline.

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Transactions across all services grew by 8.5 percent year on year, demonstrating customer trust and a resilient business model. 

Customer demand for digital channels skyrocketed, with a 94 percent year on year increase in transaction value and a 27 percent growth in transactions. 

Net Profit for the quarter ended December 31, 2023, fell 33 percent year on year to AED107 million.

The decline was due to a rise in depreciation charges linked to the expansion of the branch network and a temporary reduction in outward personal remittances to key receiving countries.

The company’s board of directors recommended a dividend payout of AED300 million for the second half of 2023, subject to shareholders’ ratification at the upcoming annual general meeting.

The total dividend payment stands at AED600 million, implying a dividend yield of 7.55 percent based on the closing price of AED1.06 per share on December 31, 2023.