Kuwait City, Apr 23: KIPCO – Kuwait Projects Company (Holding) – said that it would continue to take steps to deliver on its mission to preserve and grow the holding company by creating long-term value and sustainable growth.
This came in a presentation following the company’s Annual General Meeting. The AGM, chaired by KIPCO’s Vice Chairman, Sheikh Abdullah Naser Sabah Al Ahmad Al Sabah, saw the approval of all items on the agenda. This was followed by an Extraordinary General Meeting in which the articles of the company’s Memorandum of Association were amended to allow for the distribution of dividends on a quarterly and semi-annual basis.
KIPCO’s Group Chief Executive Officer, Sheikha Dana Naser Sabah Al Ahmad Al Sabah, gave a presentation following the AGM in which she highlighted the achievements of 2023 and an outlook for 2024.
Mission & Vision
Sheikha Dana Naser Al Sabah underscored KIPCO’s mission, to preserve and grow stakeholders’ value, together with the company’s vision, to be an agile investment holding in our core markets, delivering sustainable returns in sectors that matter to our society in the present and future.
Sheikha Dana Naser Al Sabah said:
“With KIPCO’s mission and vision in mind, our areas of thrust are to unlock value by enhancing synergies across Group companies, and to achieve a balance in the sector allocation of the investment portfolio to enhance shareholder’s return and reduce concentration.”
Strategic Priorities
Highlighting KIPCO’s strategic priorities, Sheikha Dana Naser Al Sabah said:
“Since 2022, our efforts have been aligned with our strategic priorities, which are to strengthen the performance of key portfolio investments and identify growth and investment opportunities in focused sectors; strengthen governance and synergies across the Group companies; strengthen the company’s capital structure; and foster innovation and sustainability. Our results and those of our Group companies reflect this.”
The Journey to Preserve & Grow
KIPCO’s Group CEO spoke about the holding company’s journey to preserve and grow stakeholders’ value through high impact transactions. These include the merger with Qurain Petrochemical Industries in late 2022, which resulted in an increase in net assets of KD 603 million and an increase in shareholders’ equity increasing to KD 566 million. Other transactions include NAPESCO’s acquisition of United Oil Projects, as part of efforts to create efficiencies in the oil services portfolio; the acquisition of a 52% stake in Burgan Bank Turkey from Burgan Bank, releasing 200 bps of regulatory CAR at Burgan Bank; in addition to the sale of Gulf Insurance Group and the recent merger of OSN+ with Anghami.
Sheikha Dana Naser Al Sabah noted that KIPCO’s journey also involved efforts to proactively manage liabilities to strengthen the company’s capital structure. The aim is to raise long-term financing, extend the tenor of existing liabilities, reduce interest expenses, and tap into new capital pools, as was the case with the issuance of KIPCO’s debut Sukuk. KIPCO’s Sukuk, valued at KD 103.1 million, was the first Sukuk to be issued by a Kuwaiti corporate, and the first Sukuk to be issued in Kuwaiti Dinars.
High Impact Transactions
Sheikha Dana Naser Al Sabah highlighted the sale of KIPCO Group’s 46.32% stake in Gulf Insurance Group to Fairfax Financial Holdings. The sale successfully closed in December 2023 at 2.4 times book value. The transaction resulted in proceeds of KD 256.5 million, with a realized net profit of KD 73 million.
The Group CEO spoke of developments at OSN, emphasizing the merger of OSN’s streaming business, OSN+, with Anghami. The transaction was successfully completed in April 2024 and resulted in 120 million registered users, 2.5 million paying subscribers and a combined revenue of US$ 100 million.
Sheikha Dana Naser Al Sabah said:
“By merging of OSN+ with Anghami, we have created not only one of the largest steaming platforms in the region, but a media tech company with the potential to unlock synergies for the creation of better products and more innovative offerings.”
In 2024, the combined entity will see the launch of 4K Full HD, OSN+ with ads, combined subscription offering, advanced recommendations using AI and a unified entertainment experience.
KIPCO’s 2023 Results
KIPCO is on a growth trajectory, driven by high impact transactions and successful efforts to enhance the performance of portfolio companies. In 2023, total revenue increased 23% to KD 1.3 billion, net profit was up 19% to KD 30 million, total assets went up 8% to KD 12.3 billion, shareholders’ equity rose 4% to KD 611.2 million and book value increased 4% to 134 fils per share. Portfolio companies reflected growth across different indices, reflecting the efforts to enhance their performance throughout 2023.
Asset Allocation and Sector Focus
Sheikha Dana Naser Al Sabah noted that the company has focused its efforts on six key sectors: financial services where there are opportunities for optimization; petrochemicals in alignment with Kuwait’s focus to grow the downstream industry; the high potential sectors of foodstuff, healthcare and education, and industrial services; as well as real estate where there is a potential to unlock value. KIPCO is actively seeking investment opportunities across all of these sectors, in addition to the digitization of services and enhanced technical infrastructure.
In terms of geographic presence, Sheikha Dana Naser Al Sabah said:
“Kuwait is our home market, and we also see strategic alignment of interest with the development plans in the region.”
Closing
In closing, Sheikha Dana Naser Al Sabah said:
“We continue to take steps to deliver on our mission to preserve and grow KIPCO by creating long-term value and sustainable growth that meet present needs, while supporting future ones.”