Dubai Financial Market Company (PJSC) today announced its results for the financial year ending 31 December 2018, posting a net profit of AED 125.5 million, compared to AED 232.9 million in 2017, a 46 % decline. Total revenues reached to AED 324.7 million in 2018 compared to AED 421.6 million in 2017. The total revenue comprised of AED 194.7 million of operational revenues and AED 130 million of investment revenues and others.
Company expenses reached AED 199.2 million during 2018 compared to AED 188.7 million in 2017.
Total revenue of the Company during the fourth quarter of 2018 decreased 33% to AED 72.8 million compared to AED 108.30 million during the corresponding period of 2017. The net profit of the period decreased 63% to AED 21.8 million compared to AED 59.5 million in the last quarter of 2017.
During its meeting on Wednesday, 13 February 2019, the Board of Directors reviewed and approved the annual results ahead of that will be submitted for ratification during the Annual General Meeting of the Company that will be held in coordination with the Securities and Commodities Authority (SCA).
Implementation of 2021 strategy gains momentum
Commenting on the key developments and achievements of 2018, His Excellency Essa Kazim, Chairman of the Company said, “The year 2018 has witnessed a remarkable acceleration in our efforts to implement of DFM's strategy 2021, which focuses on enhancing competitiveness, diversification of product offering, investment opportunities, continuous development and innovation of market services. We believe that achievements to date and future developments planned within our strategic framework will play a pivotal role in the coming years to further enhance market competitiveness and prepare it in the best possible way to stimulate and sustain growth.”
“The DFM has implemented numerous development plans during 2018; our plan to reorganize post-trade services in line with international best practices has made great strides. The plan aims at enhancing corporate excellence, improving performance, anticipating challenges and ensuring full readiness to realize our growth and development plans. The main objective is to separate trading activities from post-trading services, preparing the Company to meet the requirements for development and growth. The new initiative, which includes the launch of the two new companies for clearing and CSD in 2019, which will reinforce DFM's leading position amongst the regional capital markets,” H.E. Essa Kazim added.
The DFM continues to diversify its products and services, as DFM’s strategy is to provide investors with new tools that will increase liquidity and propel market activity. We have completed preparations for the launch of the REITs platform; an important addition to the market’s financial instruments. During 2018, the DFM has issued standards for the listing and trading of Investment Funds as well as for REITs. DFM is keen to provide a framework that reinforces the development of the REITs sector, which has promising growth prospects considering the impressive presence and growing global reputation of Dubai’s Real Estate sector.”
Efforts to invigorate trading activity
Commenting on DFM's efforts to promote sustainable trading activities, in collaboration with business partners such as brokerage firms and others, H.E. Essa Kazim said: “The year 2018 witnessed the launch of the Allocation Account, in a first-of-its-kind step amongst regional capital markets that caters to the requirements of the global investment funds. As part of enhancing post-trading services, DFM pioneered its REPO service, allowing investors to take access liquidity by utilizing their securities without the final sale of these securities; another first in the regional markets. Additionally, the past year has witnessed an expansion in the Margin trading, Liquidity Provision and Market Making, Regulated Short Selling (RSS) and Direct Market Access (DMA) services. Number of brokerage firms providing Margin Trading services increased to 30, whereas the number of brokerage firms that have received DMA licensing stood at 14 and the number of market makers and liquidity providers stood at four.”
Implementation of self-Regulatory Organization plan
In regards to the Securities and Commodities Authority's (SCA) self-Regulatory Organization plan, the DFM has completed the first phase of transferring responsibilities of licensing brokerage firms to DFM; whereby the licensing activities for all brokers were transferred to the market management. As part of these arrangements, the DFM modified the Margin Trading rules providing greater flexibility to investors. In cooperation with SCA, work is under way to complete the second phase of the Self-Regulatory Organization approach pertaining to listing of stocks and other products.
World class, flexible listing infrastructure
Commenting on DFM’s efforts to further diversify its listed securities, DFM’s Chairman said: “Over the past years, the DFM endeavors to educate private and family businesses on market developments and the favorable regulations in order to enhance their presence on the market with the ultimate goal to achieve a better diversification of Dubai’s dynamic and growing economic sectors. DFM’s world class listing infrastructure provides companies in the UAE and beyond flexible listing alternatives including the "Main Market Listing", the "Dual Listing" and the “Second Market” listing for private companies in light of their size, operational development and legal status. During 2018, DFM welcomed the listing of Bahrain's Ithmaar Holding B.S.C. and Egypt’s Naeem Holding for Investment. These listings further strengthen the attractive position of DFM as the most favoured listing venue for leading local and regional companies. We believe that the market is well-positioned to attract more listings in the future.”
Investor roadshows
“As part of our continuous efforts to strengthen links between listed companies and international investors, DFM’s International Investor Roadshows have seen further successes. The DFM has been organizing the roadshows since 2007, in a leading initiative amongst regional markets. During 2018, the DFM roadshows in New York (May 2018) and in London (September 2018) have witnessed further success. The latter was held in cooperation with HSBC alongside the Global Emerging Markets Forum - one of the world's largest emerging markets events – and has successfully attracted 49 international institutional investors, more than a quarter of them (28%) participated for the first time. Roadshows’ success underlines DFM ability to further attract various types of investors due to its lucrative and diversified investment opportunity as a proxy of the sound fundamental of the national economy. During 2018, the DFM has attracted more than 2000 new investors lifting the total number of its registered investors to approximately 844,000 investors.”
Smart Borse and digital transformation
“As part of DFM’s Smart Borse strategy in line with the leadership’s vision on digital transformation, the DFM continued to provide innovative services and solutions to enhance market participants’’ experience. In 2018, the DFM launched an electronic Dividend Distribution System (DDS), a unique milestone that solidifies DFM’s position amongst the most innovative markets. Accordingly, the market successfully distributed AED 17.6 billion in cash dividends for the fiscal year 2017 to nearly 575 thousand investors on behalf of 46 listed companies compared to 35 companies in 2017,” H. E. Essa Kazim said.
It is noteworthy that during GITEX 2018 the DFM launched the pilot of the Annual General Meetings service for listed companies featuring the Block Chain technology, and the pilot of the Chatbot interactive communication service.
Fortifying Dubai’s position as the Capital of Islamic Economy globally
“As part of our unwavering efforts to strengthen Dubai’s position as the Capital of Islamic Economy globally, considering DFM’s status as the world’s first Shari’a-compliant exchange since 2007, the DFM issued updated versions of three of its Shari’a standards in 201. The updated standards include; standard on Shares issued in 2007, Standard on Sukuk issued in 2014 as well as the draft of Standard on Investment Funds, which was circulated for consultation during 2018. DFM’s Shari’a-compliant standards are the first of their kind that thoroughly explain the Islamic investment instruments including; Sukuk, shares and green investment funds and called for expansion in utilizing these instruments. The updated versions of the standards provided further details on the development of green instruments whether Sukuk, shares or investment funds,” H.E. Essa Kazim concluded.
