Boursa Kuwait Securities K P S C : Transcript of the Analysts Conference

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Q2-2022

Aug 4th, 2022

Boursa Kuwait Securities Company (K.P.S.C.)

Earnings Briefing

Thursday, 04th August 2022

Edited transcript of Boursa Kuwait Securities Company (K.P.S.C.) earnings conference call that took place on Thursday, 04th August 2022 at 14:00 Kuwait time.

Corporate participants:
Mr. Mohammed Naim Azad Din -	Chief Financial Officer
Miss. Noura Al-Abdulkareem -	Head of Markets
Mr. Abdulla AlMishari -	Strategic Financial Planning and Management,
	Assistant Director

Chairperson:

Elena Sanchez - EFG Hermes

Elena Sanchez	Good afternoon and good morning, everyone.
	This is Elena Sanchez from EFG Hermes, and I would like to welcome you all to Boursa
	Kuwait's Q2 2022 Earnings Webcast.
	From Boursa Kuwait, we have with us in the call the following speakers, Mr. Naim Azad
	Din, Chief Financial Officer, Miss Noura Al-Abdulkareem, Head of Markets Sector, and
	Mr. Abdulla AlMishari, Strategic Financial Planning and Management, Assistant Director.
	I would like to hand over the call now to Mr. Abdulla AlMishari. Please go ahead.
Abdulla AlMishari	Hello everyone, and welcome to Boursa Kuwait's First Half 2022 analyst conference.
	A quick note before we begin. We have allotted some time at the end of the session for
	Q&A. Hopefully, you can see the Q&A icon in the toolbar towards the right-hand side of
	your screen. Please send your questions as we go along, and we will do our best to
	answer as many of those as possible.
	I would like to bring to your attention the disclosure on slide two of the presentation
	with respect to forward-looking statements and confidential information. Please note
	that we can only comment on questions and information that is publicly disclosed.
	This presentation will also be available at our company's website. Without further ado,
	let me hand over to our CFO, Naim Azad Din, who will be covering the financial highlights
	and performance of Boursa Kuwait's consolidated financial statements.
Naim Azad Din	Thank you Abdulla.
	Good afternoon and I welcome all of you to Boursa Kuwait's second earnings briefing for
	2022 webcast covering the quarter ended 30th June 2022.
	Thank you for giving your time amidst your busy schedule to attend this call today. We
	look forward to another engaging session today as we present the financial results of
	Boursa Kuwait Group and business updates covering market developments and other
	key aspects.
	I would also like to take this opportunity to welcome any new analysts to today's webcast
	who are interested in following our company and we look forward to engage with you
	more going forward. As we believe that you have become more well-versed with our
	company and operations, I will move to the presentation.
	Boursa Kuwait Securities Company and its Subsidiaries Consolidated Financial
	Statements for the quarter ended 30th June 2022 was approved by the Board of Directors
	on 1st August 2022 and subsequently published on the same day. In today's session, I will
	be presenting the financial performance of Boursa Kuwait Securities Company and its
	Subsidiaries Consolidated Financial Statement. Then, I will hand the session over to my
	esteemed colleague, Miss Noura, Head of Markets Sector, to share business updates.
	Boursa Kuwait continued its quarterly growth momentum by delivering another robust
	and more evidently sustainable, as can be seen on the next slide, set of quarterly results
	as we continue to realize the positive impacts of realization of implemented strategies,
	the continuous normalization of the economy post COVID-19 and stronger market
	activities.
	Operating revenue was higher by 23.9% to 18.43 million from 14.88 million in 2021.
	Operating expenses were lower by 17.25% to 4.99 million from 6.03 million recorded in
	the corresponding period in 2021. This resulted in an improved cost-to-income ratio of

27.08% compared to 40.54% recorded in 2021. Subsequently, the Operating profit improved markedly by 51.95% to 13.44 million compared to 8.85 million. Resultantly, the Operating profit margin stood at 72.92% compared to 59.46% recorded a year earlier.

Net profit attributable to equity holders of parent company recorded a commendable improvement of 36.75% to 10.72 million compared to 7.84 million recorded in 2021. Earnings per share stood at 53.37 fils versus 39.03 fils recorded in 2021.

The value of equity traded outperformed 2021 value by 30.12% to a total value traded of approximately 8.42 billion compared to a year ago at approximately 6.47 billion. Total volume traded, however, recorded a contraction of 25.17% to 31.24 billion shares compared to 41.74 billion shares in 2021.

This slide charts the quarterly trends of Operating revenue, Operating expenses, Operating profit and Net profit from second quarter 2021 to second quarter 2022. In each of the indicators highlighted, except Operating expenses, the trend continues its upward trajectory over the five quarters charted.

Operating revenue grew 18.4% year on year. Quarter on quarter, it increased by 9.7%. Operating expenses decreased by 18% year on year. Quarter on quarter, it marginally inched up by 1.7%. Operating profit increased by 40.4% and 12.8% year on year and quarter on quarter respectively. Net profit attributable to equity holders of parent company also recorded improvements by 19.7% and 4.3% year on year and quarter on quarter respectively.

This slide presents the year-to-date trend of Operating revenue, Operating expenses, Operating profit and Net profit attributable to equity holders of parent company. Over the comparative periods, positive growth trends continue, as can be seen on the selected financial highlights, as follows.

Operating revenue of 18.43 million grew by approximately 23.9% from 14.88 million. Operating expenses of 4.99 million represents a decrease of 17.2%. Operating profit of

13.44 million grew by 52% year on year from 8.85 million. Net profit attributable to equity holders of parent company of 10.72 million outperformed 2021 figure of 7.84 million by 36.7%.

The slide presents the movements in the consolidated statement of financial position elements from second quarter 2021 to second quarter 2022. Total Assets grew by approximately 4% to 110.76 million. As at 30th June 2021, total Assets stood at 106.51 million. Total Liabilities dropped by 23.5% to 12.7 million. As at 30th June 2021, total Liabilities stood at 16.61 million. Shareholder equity increased by 9.1% to 98.06 million from 89.91 million. For Equity attributable to equity holders of parent company, it increased by 10.8% from 52.61 million to 58.27 million.

The quarterly revenue shows an upward trend from Q2 2021 of 8.14 million to 9.64 million in Q2 2022, an increase of 18.42%. Subscription fees increased by 13.72% to 1.94 million from 1.7 million. This is attributed to higher market capitalisation of 41.4 billion compared to 32.2 billion, which is the basis of deriving the fee. It contributed 20.08% towards total Operating revenue.

As at 30th June 2022, there were 159 listed companies compared to 167 as at 31st December 2021, with seven delistings during the quarter under review, with total market capitalisation of around 70 million. There was one listing of Ali Al-Ghanim Automotive Company which recorded market capitalisation of 231.99 million as at 30th June 2022. The delisted companies' market capitalisation represents approximately