IHC reports marginal profit despite revenue climbing 18%

Wam

International Holding Company (IHC) has reported an increase in net profit of just 1.2 percent year on year to AED32.95 billion ($8.97 billion) in 2023, despite an almost 20 percent rise in revenue.

IHC – the Middle East’s largest listed holding company, which is listed in Abu Dhabi – is part of a business empire overseen by its chair, Sheikh Tahnoon bin Zayed Al Nahyan. He is one of the six sons of the founder of the UAE, Sheikh Zayed bin Salman Al Nahyan.

Sheikh Tahnoon, the UAE’s national security adviser, also chairs the state holding companies ADQ and Abu Dhabi Investment Authority, and First Abu Dhabi Bank, the UAE’s biggest lender. His brother Mohammed bin Zayed has been president of the UAE since 2022.

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Revenue at IHC climbed 18 percent year on year to AED60 billion after positive performances in key segments such as marine and dredging, which contributed AED18 billion, and real estate, which accounted for around a third of income.

Despite the double-digit revenue growth and significant acquisitions during the year, IHC’s expenses decreased by 18 percent year on year.

The company reported a 16 percent year-on-year growth in its total assets base, mainly in the food, real estate and construction segments.

Total debt reached AED48.4 billion in December 2023,up 21 percent from AED39.9 billion a year earlier.

The increase was mainly due to the rise in net loan drawdowns of AED6.2 billion to fund working capital and investment requirements, AED914 million of loans acquired through business combinations and AED5.5 billion non-convertible sukuk.

IHC was founded in 1998 to help diversify and develop non-oil business sectors in the UAE. It has a market cap of AED876 billion.

IHC’s share price is currently AED399.50, a rise of 1.14 percent compared to the price 12 months ago, but down from a spike of AED414 in early January.