Aamal Company has reported net profit of QR20.3mn on total revenues of QR634mn in the first six months of this year.
The profitability was impacted in the short term as Aamal navigates Covid-19 headwinds and takes action to support the economy in the national interest.
However, HE Sheikh Faisal bin Qassim al-Thani, chairman of Aamal, is confident that it will be able to navigate effectively through these challenges and return to growth in 2021, supported by Qatar’s robust economy, the resilience provided by its diverse business model and the group’s financial strength.
In the industrial manufacturing segment, revenue increased 20.8% year-on-year to QR 96.6mn, while net profit declined 51.9% to QR19.1mn.
Aamal Readymix’s new contracts generated "significant" growth, leading to a 40% revenue expansion. However, margins were impacted due to intense price competition but efforts are on to reduce costs and improve pricing and mix.
In the second half and beyond, while pricing remains uncertain, volumes are expected to rise as Qatar gradually resumes normal business activity post-Covid-19 and as the Qatari government seeks to conclude major infrastructure projects well in advance of the 2022 FIFA World Cup.
The trading and distribution segment saw revenue and net profit gain 22.3% and 19.5% to QR457.5mn and QR65.2mn respectively.
This positive result is largely attributable to the performance of Ebn Sina Medical which delivered year-on-year revenue growth of 38.9%, primarily on moving away from direct billing of customers by pharma companies and the increased orders of medical supplies to support the medical profession during the Covid-19 pandemic.
Revenue and net profit of Aamal Medical were impacted by the pandemic and Aamal Trading was also impacted by the Covid-19, as demand fell for tyres and lubricants.
Revenue and net profit in the property segment were down 48.7% and 122.1% year-on-year, respectively. This result reflects the impact of Covid-19, which, in addition to a negative impact on the fair value of investment properties totaling QR74mn, saw all retail properties (except pharmacies and supermarkets) close from mid-March 2020 until the end of the period.
All rental income payable between mid-March and the end of June 2020 have been waived, leading to a 58% decline in rental income for City Center Doha compared to the previous year. Aamal Real Estate recorded a 27% year-on-year decline, primarily due to the closure of Souq Haraj in mid-March, while the portfolio of residential properties provided some resilience to the pandemic.
The H1 was a challenging period for the managed services segment, with revenue down 49.4% year-on-year to QR25.1mn and net profit down 149.9%.
These results are largely attributable to the deconsolidation of Ecco Gulf, which impacted revenue and net profit by QR18mn and QR1.2mn, respectively, and to the impact of Covid-19. In line with the pandemic-related guidance issued by Qatari authorities, Aamal Travel, Al Farazdaq, Winter Wonderland and Fun City remained closed throughout the second quarter but are expected to gradually re-open during the second half of 2020, positively impacting the performance of this segment.
"The global nature of the Covid-19 pandemic and the uncertainty around its progression, severity and duration will continue to be felt throughout the remainder of 2020. However, continued cost control and working capital management, and the resilience provided by our diverse business model will enable Aamal to continue our progress in delivering our long-term strategy as the pandemic subsides," said Sheikh Mohamed bin Faisal al-Thani, chief executive and managing director of Aamal.
However, HE Sheikh Faisal bin Qassim al-Thani, chairman of Aamal, is confident that it will be able to navigate effectively through these challenges and return to growth in 2021, supported by Qatar’s robust economy, the resilience provided by its diverse business model and the group’s financial strength.
In the industrial manufacturing segment, revenue increased 20.8% year-on-year to QR 96.6mn, while net profit declined 51.9% to QR19.1mn.
Aamal Readymix’s new contracts generated "significant" growth, leading to a 40% revenue expansion. However, margins were impacted due to intense price competition but efforts are on to reduce costs and improve pricing and mix.
In the second half and beyond, while pricing remains uncertain, volumes are expected to rise as Qatar gradually resumes normal business activity post-Covid-19 and as the Qatari government seeks to conclude major infrastructure projects well in advance of the 2022 FIFA World Cup.
The trading and distribution segment saw revenue and net profit gain 22.3% and 19.5% to QR457.5mn and QR65.2mn respectively.
This positive result is largely attributable to the performance of Ebn Sina Medical which delivered year-on-year revenue growth of 38.9%, primarily on moving away from direct billing of customers by pharma companies and the increased orders of medical supplies to support the medical profession during the Covid-19 pandemic.
Revenue and net profit of Aamal Medical were impacted by the pandemic and Aamal Trading was also impacted by the Covid-19, as demand fell for tyres and lubricants.
Revenue and net profit in the property segment were down 48.7% and 122.1% year-on-year, respectively. This result reflects the impact of Covid-19, which, in addition to a negative impact on the fair value of investment properties totaling QR74mn, saw all retail properties (except pharmacies and supermarkets) close from mid-March 2020 until the end of the period.
All rental income payable between mid-March and the end of June 2020 have been waived, leading to a 58% decline in rental income for City Center Doha compared to the previous year. Aamal Real Estate recorded a 27% year-on-year decline, primarily due to the closure of Souq Haraj in mid-March, while the portfolio of residential properties provided some resilience to the pandemic.
The H1 was a challenging period for the managed services segment, with revenue down 49.4% year-on-year to QR25.1mn and net profit down 149.9%.
These results are largely attributable to the deconsolidation of Ecco Gulf, which impacted revenue and net profit by QR18mn and QR1.2mn, respectively, and to the impact of Covid-19. In line with the pandemic-related guidance issued by Qatari authorities, Aamal Travel, Al Farazdaq, Winter Wonderland and Fun City remained closed throughout the second quarter but are expected to gradually re-open during the second half of 2020, positively impacting the performance of this segment.
"The global nature of the Covid-19 pandemic and the uncertainty around its progression, severity and duration will continue to be felt throughout the remainder of 2020. However, continued cost control and working capital management, and the resilience provided by our diverse business model will enable Aamal to continue our progress in delivering our long-term strategy as the pandemic subsides," said Sheikh Mohamed bin Faisal al-Thani, chief executive and managing director of Aamal.