The profits of companies listed on the stock exchanges of the Gulf Cooperation Council countries declined during the third quarter of 2023 by about 14.4% on an annual basis due to the decline in energy and commodity prices.
The net profit of listed companies in the Gulf Cooperation Council countries reached US$62.3 billion in the third quarter of this year, compared to US$72.9 billion in the same period of the previous year, according to the report of the Investment Research and Strategies Unit at Kamco Investment Company issued on Sunday.
At the level of 22 sectors in the region, the profits of 12 sectors declined on an annual basis, while the profits of 10 sectors increased.
At the individual country level, the profits of companies listed in Saudi Arabia and Abu Dhabi declined at double-digit rates compared to last year, while the profits of Bahraini companies declined by 8.3%.
On the other hand, the profits of companies listed on the Kuwait Stock Exchange witnessed the highest annual growth rate of more than 40% in the third quarter of 2023, while companies listed in Dubai and Oman also showed strong growth of 35.8% and 24%.
The profits of Qatari companies did not witness any significant change, as they recorded a growth of 0.3% on an annual basis.
As for performance on a quarterly basis, the total profit of companies listed in the Gulf Cooperation Council countries increased by 7.7% in the third quarter of 2023, supported mainly by the strong performance of companies listed on the Muscat and Dubai stock exchanges, which recorded double-digit growth.
Saudi and Qatari companies showed slightly lower growth of 9.8% and 7.2% respectively, while profits of listed companies in Bahrain, Kuwait and Abu Dhabi declined on a quarterly basis.
The decline in oil prices was reflected in the profits of energy companies listed in the Gulf Cooperation Council countries, including Aramco, and the decline in profits of the capital goods and food production sectors led to an increase in the rate of decline, while the profits of the public utilities sector were affected by the rise in financing costs, as announced by the two largest companies in this year. sector.
On the other hand, banking sector profits remained resilient again, recording healthy growth on a quarterly and annual basis, in light of the growth in lending activities in most markets despite the rise in interest rates.
The communications sector also succeeded in recording higher profits on an annual basis, and the real estate sector was also able to achieve similar results in the third quarter of 2023.
As for the performance of Gulf companies’ profits for the first nine months of 2023, the decline in profits this year was sharp by 37.8%, driven almost entirely by a decline in the profits of companies listed in Saudi Arabia by more than a quarter, or the equivalent of 42 billion US dollars.
Qatari and Bahraini companies recorded a relatively smaller decline on an absolute value basis compared to the first nine months of 2022.
These declines were offset by the growth in profits of companies listed on the Dubai and Kuwait stock exchanges at double-digit rates, while the total profit of companies listed in Oman and Abu Dhabi showed slightly lower growth on an annual basis for the first nine months of the year 2023.
