Qatar's listed companies have posted a strong more than 41% year-on-year growth in the overall net earnings during 2021, indicating the corporate sector’s resiliency and reflecting the country’s sound underlying macroeconomic fundamentals, robust vaccination drive and easing of the Covid-19 restrictions.
The net earnings' growth has been mainly on account of robust expansion in the net profitability of the industrials, insurance, transport and consumer goods sectors, according to data compiled by the Qatar Stock Exchange.
The listed companies' total net profit soared 41.02% year-on-year to QR43.29bn during January-December 2021 against a 19.65% decline the year-ago period.
The resumption of business activities after the easing of pandemic-related restrictions, especially during the second quarter, had its reflection on the subsequent quarter, helping the overall earnings grow during the review year.
The banking and financial services, and industrials sectors together contributed more than 84% of the cumulative net profits during 2021, rather corroborating the strong outlook for the non-hydrocarbons, as highlighted by the Qatar Financial Centre's purchasing managers' index.
The industrials sector, which has 10 listed constituents, saw a huge 252.34% year-on-year surge in net profitability to QR13.19bn against a 44.24% decline in the year-ago period. The sector contributed 30.47% to the overall net profitability of the listed entities during 2021.
Within the industrials sector, the country’s underlying companies that have direct linkages with the hydrocarbons sectors saw price rebound, which helped net earnings enhance faster. The sectoral index jumped 29.87%, substantially outperforming the 20-stock Qatar Index that gained 11.4% in 2021.
The insurance sector, which has six companies, more than doubled (137.89% jump) their total net earnings to QR1.01bn during 2021, improving from an 18.92% increase during 2020. The sector contributed 2.33% to the overall net profitability during the review period. The sectoral index gained 13.82% during 2021.
The proposed mandatory health insurance and the substantial expansion planned in the North Field are expected to augur well for the insurance sector in the future, according to reports.
The transport sector, which has three listed constituents, saw its total net profits zoom 58.22% year-on-year to QR2.3bn compared to 19.08% shrinkage during the corresponding period of 2020. The sector's net profit constituted 5.31% to the total net profit of the listed companies during 2021.
The consumer goods and services sector, which has 10 listed entities, saw a 45.12% year-on-year expansion in total net profit to QR1.84bn at the end of December 2021 compared to a 23.14% contraction in the previous-year period. The sector contributed 4.25% to the overall net profitability in the review period. Its index rose 7.92% in QSE during 2021.
The banks and financial services sector, which has 12 listed entities, reported a 12.85% year-on-year jump in total net profit to QR23.31bn against a 12.22% contraction the comparable period of 2020. The sector contributed 53.85% to the total net profits of the listed companies in January-December 2021. Its index rose 16.82% in QSE during 2021.
However, the realty segment, which has four listed entities, saw its total net earnings plunge 31.15% year-on-year to QR1.25bn during 2021 against a 20.1% drop in the year-ago period. The sector constituted 2.89% to the overall net profitability in the review period. The sectoral index had plummeted 9.77% during 2021.
The telecom sector, which has two constituents, witnessed an overall 71.46% decline in net profit to QR0.37bn compared to a 29.81% deceleration during 2020. Its index nevertheless saw a 4.66% jump in QSE during 2021.
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