Muscat: Total net profits for Muscat Securities Exchange (MSX) listed companies in Oman increased by 14 per cent year-on-year (y-o-y) to $457.6 million in the third quarter of 2022 as compared with $401.4 million in the corresponding quarter in 2021, according to a new report.
The third quarter of 2022 earnings of the banking sector, the biggest sector in the exchange by market cap, improved by 21.4 per cent to reach $279.80 million up from $230.60 million in the third quarter of 2021, the Kuwait-based investment strategy and research, Kamco Invest, said in its 'GCC Corporate Earnings Report: Q3-2022.'
The diversified financials sector followed with the second-largest total net profits among the sectors with $92.40 million during the third quarter of 2022 up from $17.20 million in the third quarter of 2021.
All the eight banks which announced Q3-2022 net profits registered year-on-year (y-o-y) growth in earnings except for Bank Dhofar which witnessed 14.1 per cent profits slide to $25.10 million. Bank Muscat’s Q3-2022 net profits witnessed 7.7 per cent y-o-y growth to reach $127.40 million as compared to $118.20 million in Q3-2021.
The bank attributed the quarterly earnings growth to revenue increase from both non-interest income and net interest income from the conventional banking business. Bank Muscat’s Q3-2022 earnings represented 45.5 per cent of the total profits in the banking sector.
National Bank of Oman recorded Q3-2022 net profits of $34.90 million as compared to $20.40 million in Q3-2021. The bank attributed its quarterly performance to a combination of growth in net interest income, fee income and a fall in operating expenses, the Kamco Invest report said.
In the diversified financials sector, Ominvest posted the biggest profits during Q3-2022 with net profits of $86.80 million as compared to $14.60 million during Q3-2021. The investment company attributed the jump in its quarterly net profits to an increase in revenue on the back of its acquisition of RSA ME by the National Life and General Insurance Company.
Despite witnessing subdued growth of 3.9 per cent y-o-y during Q3-2022, the telecom sector’s aggregate profits were the third largest among the sectors reaching $51.20 million as compared to $49.20 million during the corresponding period of 2021.
Total Q3-2022 net profits of the Energy Sector reached $21.30 million as compared to $16.30 million in Q3-2021 witnessing a 30.2 per cent y-o-y growth. Al Maha Petroleum Products registered the largest absolute profit rise among the five companies in the sector with Q3-2022 net profits of $6.20 million up from $2.70 million in Q3-2021. The company attributed its robust performance to the expansion of its customer reach underpinned by a strategic repositioning to meet changing customer preferences after the COVID-19 period.
GCC quarterly profits
After reaching a record during Q2-2022, quarterly profits for GCC-listed companies witnessed a q-o-q decline of 8.0 per cent or $6.10 billion during Q3-2022 mainly led by a fall in earnings for Energy and Materials companies, the Kamco Invest report said.
The declines were also reflected in the respective sectoral indices with the Bloomberg Global Basic Materials Index declining by 10.50 per cent during Q3-2022 while crude oil prices dropped by 23.40 per cent during the quarter.
However, higher profits mainly for the food, beverage & tobacco, capital goods and utilities sectors partially offset the overall decline. Banks also reported marginally higher q-o-q profits that reached $11.30 billion during Q3-2022 as compared to $10.90 billion during the previous quarter. 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 q-o-q decline during Q3-2022.
In terms of y-o-y performance, net profits continued to show growth in Q3-2022 and were up by almost a quarter to reach $70.70 billion as compared to $57.20 billion during Q3-2021. Higher profits also reflected better economic performance in the region as compared to last year. The y-o-y profit improvement was broad-based with more than two-thirds of the sectors showing higher profits during Q3-2022.
Profits for energy, banks, capital goods and food, beverage and tobacco sectors were the main growth drivers during Q3-2022 vs. Q3-2021 which was partially offset by a decline in profits mainly for the Transportation and Materials companies.