Saudi Arabia: Energy firms and banks helped fuel a 32 percent year-on-year rise in aggregate profits for listed companies in Saudi Arabia in the third quarter of 2022, according to a report released by Kamco Invest.

The analysis noted that net profits hit $51.9 billion in the three months to the end of September — up from $39.3 billion in the same period of 2021.

The report, however, noted that the aggregate profit of Saudi Arabian firms in the third quarter reported a decline of $7.4 billion compared to the previous quarter this year, where the total net profit stood at $59.3 billion.

Across the Gulf Cooperation Council region, listed firms witnessed a quarter-on-quarter decline of 8 percent at $76.9 billion, due to the fall in the earnings for energy and material companies.

“In terms of regions, only UAE-listed companies showed higher profits during the quarter, whereas aggregates for the rest of the GCC countries showed a quarter-on-quarter decline during the third quarter of 2022,” wrote Kamco in the report.

Companies operating in the Kingdom’s energy sector witnessed the maximum profit during the third quarter at $41.2 billion, driven by crude oil prices and volumes sold.

The report further noted that the profit of the banking institutions in Saudi Arabia increased to $4.4 billion during the third quarter, up from $3.5 billion during the same period in 2021.

In the banking sector, Al Rajhi Bank recorded a profit of $1.2 billion in the third quarter, supported by higher net financing and investment income, fees from banking services, and exchange income.

Saudi National Bank reported a 24.6 percent increase in the net profit to $1.3 billion, driven by a 16.1 percent drop in operating expenses due to a lower net impairment charge for credit losses.

Net profit of telecom companies in the Kingdom also grew by 22.2 percent year-on-year to $1.1 billion in the third quarter, while profits for the food and staples retailing sector almost tripled year-on-year to reach $281.6 million.

According to the Kamco report, Saudi Arabian firms operating in the materials, utilities, pharmaceuticals, biotechnology and life sciences, and consumer durables and apparel sectors witnessed a decline in profit during the third quarter.

In terms of year-on-year performance by GCC companies, net profits continued to show growth in the third quarter of 2022 and were up by almost a quarter to reach $70.7 billion as compared to $57.2 billion during the same period in the previous year.

“Abu Dhabi-listed companies showed the biggest y-o-y profitability improvement during the third quarter of 2022 with net profits almost doubling to $9.1 billion, reflecting both new listings as well as higher profits for the bulk of the listed companies on the Abu Dhabi exchange,” the report added.

Country breakdown

Aggregate net profits for Kuwait-listed firms witnessed a year-on-year decline of 74.0 percent in the third quarter to reach $1.5 billion compared to $5.8 billion in the same period of 2021.

According to the report, the decline in the profit of Kuwait-listed firms was mainly led by lower year-on-year profits reported by Agility, which had booked an extraordinary gain of around $3.1 billion in the third quarter of 2021 post the sale of its integrated logistics business to DSV Panalpina.

Net profits for Dubai-listed companies increased by 32.8 percent in the third quarter to reach $4.1 billion, the report added.

Total earnings for Qatari-listed companies increased by 1.7 percent over the same period to reach $3.32 billion as compared to $3.27 billion in the corresponding three months of the previous year.

Net profit of Bahrain-listed companies decreased by 44 percent year-on-year to $405.5 million after six of its 13 sectors — including its two largest sectors by market cap — posted a decrease in net profits during the quarter.

Total net profits for listed companies in Oman increased by 14 percent year-on-year to $457.6 million in the third quarter as compared to $401.4 million in the corresponding quarter in 2021.