The Board of Directors of Aamal Company QSC (“Aamal”), one of the GCC’s fastest growing diversified companies, today announces its financial results for the half year ended 30 June 2016.

Financial Highlights

• Group revenue up 3.0% to QAR 1.39bn (H1 2015: QAR 1.35bn)

• Gross profit up14.5% to QAR 355.3m (H1 2015: QAR 310.4m)

• Total net profit¹ up 23.5% to QAR 305.5m (H1 2015: QAR 247.4m)

• Reported earnings per share up 17.1%at QAR 0.41(H1 2015: QAR 0.35)

• Net investment in capital expenditure rose by QAR 14.1m to QAR 60.1m (H1 2015: QAR 46.0m), reflecting fleet expansion at the Aamal Maritime Transportation Services subsidiary, and the ongoing Phase 2 redevelopment works at the City Center Doha shopping mall

• Financial gearing²remains low at3.9% (31 December 2015: 3.6%)

¹ There were no fair value gains on investment properties in either H1 2016 or H1 2015; net profit is stated before the deduction of non-controlling interests

²Net debt to net debt plus total equity

(N.B. there may be slight differences due to rounding)

H.E. Sheikh Faisal Bin Qassim Al Thani, Chairman of Aamal Company QSC, commented: “The first six months of this year have witnessed a tremendous performance with total net profits growing by over 23% compared to the corresponding period in 2015. The majority of this growth is derived from margin expansion within our Industrial Manufacturing division, which now makes up over 38% of total company profits. As one of the leading industrial companies in the State of Qatar, Aamal Company is well positioned to be a direct beneficiary of the country’s infrastructure-led development programs.

“Although our industrial focus has clearly been the Company’s primary growth engine, the strong contributions made by our other three divisions should not be overlooked. All these businesses occupy leading market positions across the entire Qatari economy. As with our industrial manufacturing activities,we will continue to invest to sustain our momentum, either through strengthening our existing operations or pursuing new opportunities after careful consideration. Our low level of financial gearing, allied to strong free cash flow generation, clearly puts us in a very advantageous position.”

BREAKDOWN BY DIVISION

(N.B. there may be slight differences due to rounding)

·           REVENUE

·           NET PROFIT

* Net profit contribution from Aamal’s 20% interest in Frijns Structural Steel is now included within Industrial Manufacturing, whereas previously it was netted off against Head Office costs; H1 2015 comparative numbers have been amended accordingly

DIVISIONAL REVIEW

(N.B. there may be slight differences due to rounding)

• INDUSTRIAL MANUFACTURING

Overall revenues grew by 4.6% which together with a significant improvement in the underlying margin and a strong net profit contribution from our joint venture and associate interests, led to overall net profit rising by 91.8% to QAR 117 million. The outstanding performer was Senyar Industries, as its two operations (Doha Cables and El Sewedy Cables) continued to win profitable contracts, along with a tight rein maintained on costs. Aamal Readymix also performed well, with its operating margin more than doubling due to higher sales prices being charged on new contracts; this degree of pricing power is reflective of the business’s strong competitive position.

Further upside came from Ci-San Trading, which benefitted from its move into the marine transportation of aggregates in September 2015 and expansion of the fleet in the first quarter of this year.

• TRADING AND DISTRIBUTION

Although revenues fell by nearly 6%, partly a reflection of one-off supply chain issues out of our control that have now been resolved, margins improved which will stand us in good stead going forward. This improvement in margin is a good illustration of the importance we place on continually seeking operating efficiencies wherever possible without detriment to the underlying business.

• PROPERTY

Phase 2 of the expansion and redevelopment of City Center Doha, one of the leading shopping malls in Qatar, continued apace and is on track for completion in 2018. As to be expected, this has had some marginal impact in terms of profitability in the short term as some of the spaces available for retail are being redeveloped. What is particularly pleasing in this period is that we have separately recognised a separately accounted for net profit contribution (QAR 3.4 million) from our joint venture Aamal ECE.

• MANAGED SERVICES

Revenues grew by 43.7% which together with a material expansion in the margin, led to overall net profit growth of 95.8%. There were two main components to this growth: one, the strength and resilience of the existing businesses (boosted by the winning of a number of new contracts); and two, the acquisition of Family Entertainment Center and Winter Wonderland earlier this year, whose performance to date has surpassed our original expectations.

SUMMARY AND OUTLOOK

H.E. Sheikh Mohamed Bin Faisal Al Thani, Vice-Chairman of Aamal, commented: “Aamal Company has performed very creditably in the first half of this year, notching up an impressive rise in total profits of over 23%. This has been driven by margin expansion which is testimony to our relentless focus on profitable growth through careful allocation of capital and a strong emphasis on operating returns. By remaining at the vanguard of Qatar’s infrastructure-led development, it is my strong conviction that we are well positioned to take advantage of structural growth opportunities as they continue to evolve.”

Tarek M. El Sayed, Managing Director of Aamal, commented: “Aamal Company has many unique qualities that helps us to stand out. These include our leading market positions across the entire Qatari economy, our proven track record in strategic asset allocation coupled with a clear focus on returns and value creation, and our balance sheet strength. We strive to be the best we can be and our latest set of results attests to this.”