Ominvest shareholders approve 25 per cent dividend proposal

Muscat: Shareholders of Oman International Development and Investment Company (Ominvest) have approved a proposal to pay 25 per cent dividend, comprising a cash dividend of 25 per cent and a stock dividend of 10 per cent, for 2016. The decision was taken at the company’s annual general meeting on March 29, 2017.

Ominvest Group revenues rose by 59 per cent to OMR227 million and group net profit grew by 1 per cent to OMR37.6 million over the same period in 2015. Ominvest’s share of the group net profit stood at OMR23.9 million compared to OMR22.9 million, a growth of 4 per cent, over the same period in 2015. The growth in net profit was attributable mainly to the strong growth in the new subsidiary Oman National Investment Corporation (ONIC), which recorded total investment income of OMR7.1 million for 2016.

Oman Arab Bank (OAB) increased its net loans and advances by 5 per cent to OMR1.59 billion and customer deposits by 2 per cent to OMR1.64 billion, as at December 31, 2016, over the same period in 2015. OAB reported net profit of OMR24 million in 2016, a decline of 16 per cent as compared to the previous year, primarily due to sudden rise in cost of funding amid a liquidity crunch, drop in non-interest income and sharp rise in provisions.

National Life & General Insurance Company (NLGIC) continued its steady growth with net insurance premiums rising by 25 per cent to OMR57 million for the year ended December 31, 2016, signifying the underlying growth in the broader insurance sector, and more importantly, major gains in NLGIC’s market share. NLGIC’s net profit rose by 8 per cent to OMR4.7 million, over the same period in 2015.

Profits from Ominvest’s associate companies rose to OMR8 million compared to OMR3.8 million, a growth of 110 per cent, mainly driven by the merger with ONIC Holding on August 19, 2015 which increased the total number of associates from 3 to 11. Also, the company’s investments in associate companies have helped enhance and diversify the income sources – ensuring steady profitability in the coming years.

Ominvest tightly controlled its operating expenses, which stayed flat compared to last year. The cost to income ratio stood at around 12 per cent, among the lowest versus peers in the region. During the current downturn, Ominvest increased leverage at competitive rates to be able to buy high quality businesses at attractive valuations, putting in place a recurring stream of yearly dividends and potential for capital gains, over the long term. As a result of its opportunistic investments, its debt-equity ratio modestly increased to 58 per cent.

Ominvest, along with its strategic partners, Oman Investment Fund and Arab Bank (Switzerland) Ltd., has established Ubhar Capital (U Capital), which envisions to become Oman’s leading independent investment banking platform. U Capital has acquired Oman Arab Bank’s investment banking business OABINVEST, which has a long-standing track record in corporate finance, asset management, brokerage and a leading market share in Oman. With the support of the strategic partners and committed stakeholders, Ominvest is focused on building U Capital into one of the largest and most valuable Omani investment company and asset manager – with regional capabilities and international reach, said Khalid Muhammad Al Zubair, chairman of Ominvest.

Although, the current business conditions are challenging, Ominvest is optimistic about its strong financial position and future prospects and remain highly supportive of the major initiatives that the management has undertaken.