Saudi Arabia-based APICORP reports net income of $52mn in H1 2022

The Arab Petroleum Investments Corporation (APICORP) announced its H1 2022 results, continuing its post-pandemic growth with major financial and operational achievements against a backdrop of market volatility and inflation concerns.

At the end of the first half of 2022, APICORP recorded a net income of $52m, a 67 per cent year-on-year (YoY) increase.

The corporation’s balance sheet marginally grew by 3 per cent YoY to $8.26bn.

Net income from operations grew significantly to $97.9m in H1 2022 from $40.7m in H1 2021.

APICORP’s treasury assets reached $2.9bn, representing an increase of U$712m or 32 per cent YoY rise. This was attributed to the opportunities available in money market placements and the lower cost of funding for short-term borrowings.

Moreover, treasury income grew by $31.6m mainly due to restructuring of treasury investment book and higher gross interest earnings and capital gains from the sale of fixed income securities as the average price of LIBOR (London Inter-Bank Offered Rate) reached 100 basis points compared to 18 basis points in H1 2021.

Dr Aabed Al-Saadoun, chairman of the APICORP Board, said: “APICORP has continued to deliver robust and consistent results in the first half of 2022, despite growing market volatility and inflation concerns.

“Our structural and strategic resilience has facilitated exceptional performance in all our business segments as we continue to showcase our economic and community impact and cement our legacy of financing for impact.”

Khalid Ali Al-Ruwaigh, CEO of APICORP, said: “Even as the global and regional financial markets are facing economic headwinds, APICORP recorded an increase in the balance sheet and income YoY during the first six months of 2022. All business units continued to deliver growth showcasing alignment with our growth strategy.

“The treasury business unit in particular showcased growth led by better money market performance of our investments. Our goals continue to define our ongoing operational and financial performance as we work towards achieving a balanced energy transition and providing financial services and solutions for the energy of tomorrow.

Performance highlights

Treasury and capital markets
The treasury and capital markets portfolio had an exceptional first half due to lucrative opportunities available in money market placements. The unit was the best performer increasing in size in the first six months of 2022 to $2.9bn and beating budgeted returns to record a gross income of $21.9m.

Investments
The net income of the corporation’s equity investment portfolio rose by 41per cent to reach $30m in the first half of 2022, buoyed by higher dividend income. Investment assets increased by $25.5m due to the upward revaluation of certain investments.

Corporate banking
The Corporate Banking unit’s assets slipped by 10 per cent to $4.1 bn due to net repayment including secondary market sales. While the gross income rose by 22 per cent YoY, reaching $74.7m in H1 2022.

Earlier this year, APICORP successfully launched the first A/B loans programme in the region leveraging its preferred creditor status to encourage international debt financing for projects in the region.

Read: APICORP leverages preferred creditor status to launch A/B loan programme