SHUAA Capital psc (DFM: SHUAA), the leading asset management and investment banking platform in the region innovated by the merger of SHUAA Capital and Abu Dhabi Financial Group (ADFG), secured board approval of the company strategy for 2020 and the audited financial statements for the fiscal year ending 31 December 2019.

SHUAAs audited annual results for 2019 spotlighted the firm's solid financial performance and ability to retain revenues and capitalize on growth opportunities, In spite of the focus on merger and integration activity as well as difficult market conditions and geopolitical uncertainty. The company reported an EBITDA of AED 186 million and a net profit to shareholders of SHUAA Capital of AED 47 million by 31 December 2019.

The consolidated financial results for 2019 indicated the instant positive result of the merger between the two entities (ADFG and SHUAA) with the organization anticipating to realize merger synergies amounting to a run rate of AED 50 million per year by Q2 2021.

Sustainable and ongoing growth

Following the innovation of a financial powerhouse, SHUAAs key focus in 2019 was to give a boost to its role as a leading regional asset management and investment banking platform.

The companys asset management business retained its boom trajectory, with assets under management attaining US$14 billion in 2019, up 15% year-on-year. Furthermore, SHUAAs investment banking business remained to be one of the most active in the region. The company played a vital role in the regional Sukuk (Sharia-compliant bond) market as a mandate lead arranger for over US$500 million of Sukuk issuances and offered strategic advisory services to an extended client base.

The company also attained a 28% reduction in non-core assets in 2019 primarily via the sale of its brokerage arm (SHUAA Securities) and exit of equities market-making business for a whole deal value of c. AED 100 million.

Medium-term strategy put in place

Backed by a profitable year and robust fundamentals for durable growth, the company has set clear aim for 2020, supported by its board of directors: speeding up growth by further integration and synergies between the two combined entities, as well as enforcing SHUAAs profitability through recurring revenues.

Growth, diversification and scale

With these aims in place, SHUAA is continuing the following strategies in 2020:

a) To access new revenue pools by enlarging our investment banking franchise, growing our asset management business and expanding our regional footprint resulting in the boosting up and expansion of our core businesses.
b) To increase recurring income by engineering new products, growing both permanent capital vehicles and our fixed income platform resulting in a diversified product and service offering throughout our core businesses.
c) To increase profitability and boost up control by digitizing the company, optimizing our balance sheet structure, and increasing operational efficiency.

SHUAA aims this strategy to get hold of its growth trajectory in the medium to longer term and deliver long-term value for its shareholders while increasing assets under management to US$ 20 billion.

Fadhel Alali, Chairman of SHUAA Capital psc, stated: I am proud of what our leading entity reached in 2019, and I thank our board of directors and esteemed shareholders for their trust and constant support. We successfully executed a transformational merger, adding another historical milestone to the rich legacy of SHUAA and setting a benchmark for 2020 and onward. While functioning under a new vision and strategy, we have faith in the management capability to deliver. Full integration will allow us to leverage SHUAA's asset management and investment banking capabilities and realize our ambitious growth targets for 2020 and beyond.

Jassim Alseddiqi, Chief Executive Officer of SHUAA Capital psc, stated: This well-defined strategy sets the foundation for significant and sustainable growth, in spite of market challenges resulting from COVID-19 and falling oil prices. We have always been pioneers in exploring and creating profitable opportunities amid difficult times. Our strategic plans, ambition and talent will allow us to boost up our position as a leading regional investment manager, achieve regional dominance in investment banking and solidify our innovation leadership. Our track record of creating value for our clients, employees and shareholders makes us confident in our ability to maintain profitability and achieve our medium-term growth targets. We thank our board for their faith in us as we continue to deliver long-term value for shareholders.

The strategy declaration coincided with board approval of SHUAAs audited results for the fiscal year ending 31 December 2019.