GIS posts 27% growth in net profit
08 Feb 2018 - 0:00
DOHA: Gulf International Services (GIS), the largest services group in Qatar, has reported a net profit of QR85m for last financial year ended December 31, 2017, up by 27 percent compared to previous year.
The total revenue of the Group reached QR2.5bn for 2017, down about 17 percent compared to 2016. Earnings per share (EPS) stood at QR0.46 (46 dirhams) for the year.
The Board of Directors has recommended no dividend for the 2017 and will instead use the funds for investment opportunities identified in the Company’s growth strategy; where GIS will deploy the retained funds to invest in the group’s activities, capturing the growing demand locally and internationally.
GIS is one of the largest companies in Qatar with interests in a broad cross-section of industries, ranging from insurance, re-insurance, onshore and offshore drilling, accommodation barge, helicopter transportation, and catering services.
The aviation and drilling segments’ revenue remained flat on the previous year. The catering segment’s revenue was impacted by the demobilization of major contracts. General downturn in medical and general insurance business and rate reduction affected the insurance segment.
The increase in net profit was primarily due to an increase in other income, as there was a one-off item relating to retirement of an asset in the drilling segment reducing the other income in the previous year. No such retirement during the year. The cash position stood at QR900m across all group companies as at December 31, 2017.
The group is in the process of executing a series of initiatives to better utilize its asset base and to decrease its operating costs across the group companies. These initiatives include identification and short listing of a number of new opportunities, and further rationalisation of the costs together with optimising the utilisation of operating assets and the supply chain.
For the period from the initial public offering in February 2008 to 2016, the group’s shareholders have received accumulated cash dividends of QR2.6bn, which is equivalent to circa QR14.2 per share, with an average payout ratio of approximately 55 percent. In addition, shareholders have received a total of 63 million additional shares through three bonus issuances.
The Board of Directors, after taking the current and future operating, investing, and financing needs of the business, believes that a dividend payment in 2017 will add further burden to the group’s liquidity position, and will place many bottlenecks for future strategic development.