Waha Capital PJSC, an Abu Dhabi-listed investment management company, has reported a 69% increase in 2021 net profit to AED 391 million, compared to net profit of AED 231 million in 2020, driven by strong returns from its emerging markets credit and equity funds.
The Public Markets business, which reached US$1.2 billion of assets under management (AUM) during 2021, recorded investment gains and fee income of AED 902 million and a net profit of AED 603 million for the year. Despite increased volatility in global capital markets, all funds managed by the business have continued to outperform their relevant industry benchmarks.
Meanwhile, the Private Investments business which started implementing a new multi-year strategy, recorded a net loss of AED 86 million due to impairments and mark-to-market losses on certain legacy investments. These were partially offset by gains on the divestment of a majority of the Company’s U.S. Securities portfolio.
Waha Land’s industrial real estate assets maintained their high occupancy over the year, continuing to generate a steady profit of AED 35 million for the Company.
Waha Capital’s total AUM stood at AED 5.84 billion as of 31 December 2021. The Company has maintained an efficient operating model throughout 2021, as demonstrated by a cost-to-income ratio of 25%, which is 7% lower than the previous year.
In the fourth quarter of the year, MSCI, one of the world’s leading index providers, selected Waha Capital for inclusion in its key UAE and global small-cap indices. The decision by MSCI raises Waha Capital’s profile amongst global institutional investors, as MSCI indices attract capital from passive funds and other investment vehicles.
The Company’s board recommends a cash dividend of 7.55 fils per share, in addition to the transfer of 2.45 treasury shares to the shareholders for every 100 shares owned by them. These recommendations remain subject to regulatory approvals and shareholder ratification at the Company’s Annual General Meeting.
PUBLIC MARKETS HIGHLIGHTS
Building on a solid multi-year track record, Waha Capital’s Public Markets business delivered an 87.9% increase in year-on-year net profit, realising AED 603 million compared to the AED 321 million net profit in 2020. All funds outperformed their respective benchmarks, with AUM growing to AED 4.4 billion as of 31 December 2021.
Waha Capital’s emerging markets funds demonstrated robust performance during 2021 despite a challenging macroeconomic environment caused by the pandemic and inflationary pressures. Forbes Middle East ranked the Public Markets business as one of the Middle East’s 30 Biggest Asset Managers in 2021.
The Waha MENA Equity Fund yielded a total return of 32.8% in 2021, bringing the cumulative total return to 238% since its inception in 2014. This is equivalent to an annualised rate of return of 16.6%. The Fund was also recognised by the Global Investment Report as one of the world’s top 50 hedge funds, the only hedge fund based in the MENA region to be featured.
The Waha CEEMEA Credit Fund yielded a total return of 7.2% in 2021. Since its inception in 2012, the Fund has successfully delivered a total return of 173.6%, equivalent to an annualised rate of return of 10.6%.
The Waha Islamic Income Fund, which invests in global sukuks and Shari’a compliant equities, yielded a total return of 9.7% for 2021. Since its inception in 2020, the Fund has generated a cumulative investment return of 14.4%.
The business has also taken steps to expand its fund offering, including seeding new strategies to establish a solid track record, to eventually bring them to market.
PRIVATE INVESTMENTS HIGHLIGHTS
The Private Investments business began activating its new long-term, multi-asset investment strategy in the final quarter of 2021, which now sees investments organised into three main portfolios.
For its Global Opportunities portfolio, Waha Capital is pursuing a fully flexible, opportunistic global mandate that targets investments in the alternatives space with high risk-adjusted returns. In Q4 2021, the business made its first two investments within this portfolio, with further transactions in the pipeline earmarked for Q1 2022.
The Core portfolio has been launched and seeded with the Company’s existing healthcare platform, which is being reorganised to optimise its growth potential. The Private Investments business will look to further grow its Core portfolio by opportunistically taking controlling or significant minority stakes in other cash generative businesses within the MENA region, led by best-in-class management teams with established track records.
Following a strategic review, the Private Investments business has begun implementing a multi-year plan to drive value-creation for the Legacy portfolio. As part of this, the business has successfully divested almost all of its tactical holding in the Company’s U.S. Securities portfolio, crystalising the solid returns achieved since the initial investment in May 2020. The Company also successfully exited its stake in Deem Finance, and partially exited its stake in National Energy Services Reunited Corp (NESR).
WAHA LAND HIGHLIGHTS
Waha Land, the Company’s real estate subsidiary, which owns and manages an integrated mixed-use industrial development with Grade “A” industrial and logistics facilities and first-class infrastructure, continued to remain resilient through the global pandemic and maintained 95% occupancy in 2021. The business generated steady net profit of AED 35 million in 2021, a strong 52% increase from AED 23 million in the previous year.
ABOUT WAHA CAPITAL
Waha Capital is an Abu Dhabi-listed investment management company that leverages its emerging markets expertise, business networks and research capabilities to deliver attractive returns to shareholders and investors in its funds.
Founded in 1997, Waha Capital is one of the Emirate’s leading private sector investment houses, providing a world-class platform for investment and growth. The Company has a long-established track record of investing in public and private markets, deploying proprietary capital in alignment with third-party investors.
The Public Markets business offers sophisticated investors actively managed emerging markets credit and equities funds, via a disciplined approach to investment and implementing distinctive strategies to deliver consistent market-leading returns.
The Private Investments business pursues a multi-asset investment approach, with the flexibility to deploy capital across diverse sectors and geographies. The business leverages extensive international business networks to source deals and form co-investment partnerships.
Counting Mubadala Investment Company as an anchor shareholder, Waha Capital is at the forefront of Abu Dhabi’s increasingly dynamic and entrepreneurial ecosystem, creating long-term value for shareholders, fund investors, employees, and communities.