Saudi hit by weak Q3 re­sults, UAE re­bounds

Kuwait Times - - BUSINESS -

DUBAI: Sev­eral dis­ap­point­ing thirdquar­ter re­sults from large Saudi Ara­bian com­pa­nies dragged on the king­dom’s stock in­dex yes­ter­day, while most other Gulf mar­kets edged up in mod­est trade. Egypt pulled back in fall­ing vol­umes. Riyadh’s in­dex fell 1.9 per­cent, with sell­ing mo­men­tum in­ten­si­fy­ing in the fi­nal hour. Saudi Ara­bian Min­ing Co (Maaden) fell 1.8 per­cent after it posted a 4.6 per­cent rise in third-quar­ter net profit to 83.6 mil­lion riyals ($22.3 mil­lion), be­low an­a­lysts’ av­er­age fore­cast of 122.7 mil­lion riyals.

Na­tional In­dus­tri­al­iza­tion Co (Tas­nee) swung to a net profit of 122.2 mil­lion riyals from a loss of 296.3 mil­lion riyals in the prior-year pe­riod. But NCB Cap­i­tal said the result was 18 per­cent be­low its ex­pec­ta­tion and the stock slumped by its daily limit of 10 per­cent.

Chief Ex­ec­u­tive Mut­laq Al-Mor­ished de­nied a Bloomberg report that the firm had stopped mak­ing pay­ments on a $1 bil­lion loan. “Ask any bank. This is to­tally inac­cu­rate. We did not de­fault or de­lay any pay­ments. Take my word: we do not sus­pend a bil­lion dol­lars,” he told re­porters.

In an in­ter­view with Al-Ara­biya television, he said Tas­nee had be­gun in­for­mal talks with lo­cal banks to re­fi­nance the loan at bet­ter terms, as it had done with a 7 bil­lion riyal fa­cil­ity for its Cristal sub­sidiary ear­lier this year, with ne­go­ti­a­tions set to last at least six months.

Saudi Fer­til­izer Co (SAFCO) fell 4.2 per­cent to 62.75 riyals after it posted a 68 per­cent de­cline in third-quar­ter net profit to 181.4 mil­lion riyals, miss­ing an­a­lysts’ pre­dic­tion of 249.2 mil­lion riyals. NCB Cap­i­tal said this was SAFCO’s low­est net in­come on record, blam­ing weak gross mar­gins and lower in­come from Ibn Al-Bay­tar, a joint ven­ture with Saudi Ba­sic In­dus­tries . NCB re­mains “neu­tral” on the stock with a 63.40 riyal tar­get. Sa­hara Petro­chem­i­cal tum­bled 5.2 per­cent after post­ing a 13 per­cent drop in net in­come. Banks were mixed with Al-Ra­jhi Bank adding 1.0 per­cent after it re­ported a 16.7 per­cent rise in profit, meet­ing fore­casts; it was the first ma­jor bank in Saudi Ara­bia to report higher prof­its for the third quar­ter.

An­a­lysts at Riyad Cap­i­tal said there was no ma­jor in­crease in bad loan pro­vi­sions at the re­tail-fo­cused bank in the third quar­ter, con­trary to many of its cor­po­rate-fo­cused peers.

Samba Fi­nan­cial Group dropped 2.1 after it re­ported a 2.2 per­cent drop in quar­terly net profit, in line with fore­casts. Saudi Hol­landi Bank recorded a 46.7 per­cent fall in profit to 262.8 mil­lion riyals; an­a­lysts had fore­cast 506.4 mil­lion riyals. Its shares slumped 6.7 per­cent. The first Saudi telecom­mu­ni­ca­tions op­er­a­tor to report third-quar­ter re­sults, Zain Saudi, fell 5.8 per­cent after it re­ported a third-quar­ter loss of 267 mil­lion riyals. That was in line with ex­pec­ta­tions but quar­terly rev­enue shrank 7 per­cent.

UAE RE­BOUNDS, EGYPT SLIPS

Dubai’s in­dex rose 1.4 per­cent with at­ten­tion fo­cused on small and mid­sized shares as large-caps have yet to report third-quar­ter re­sults. Builder Arabtec climbed 3.0 per­cent and Union Prop­er­ties added 2.3 per­cent. In Abu Dhabi, First Gulf Bank, which has been volatile in re­cent days, gained 3.8 per­cent. The main in­dex closed 1.2 per­cent higher.

Qatar’s in­dex rose 0.6 per­cent as 85 per­cent of the traded shares ad­vanced. Qatar Na­tional Bank, which re­ported strong earn­ings last week, added 1.3 per­cent. In Cairo, the in­dex edged down 0.4 per­cent. Trad­ing vol­umes were roughly half of those hit on Mon­day.

Global Tele­com Hold­ing, a stock favoured by in­ter­na­tional in­vestors, lost 4.4 per­cent and pri­vate eq­uity firm Qalaa Hold­ings closed down 4.4 per­cent. — Reuters

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