The second day of the “Shafafiyah” (Transparency) KIPCO Group Investors’ Forum heard presentations by the Group’s Gulf Insurance Company (GIC), the largest commercial and personal insurance provider in Kuwait with expanding regional operations; and Burgan Bank; Kuwait’s leading technology-driven bank, which focussed on growth strategies rooted in leadership and innovation.
KIPCO (Kuwait Projects Company), the US$ 15 billion regional business enterprise, is staging the three-day Forum to highlight its financial transparency in a series of investor presentations by the Group and its directly-held listed subsidiaries to audiences of fund managers, analysts, shareholders and clients.
The event at Kuwait’s Marina Hotel, organised by Group member KIPCO Asset Management Company (KAMCO) is the second in a series of financial transparency forums staged by KIPCO, the first regional business organisation to present its financial performances and forecasts in a transparent manner, with free and open dialogue.
GIC managing director and chief executive officer Khalid Al Hassan gave an overview of the company’s principal activities in offering insurance coverage to major business lines including motor, marine & aviation, property & casualty, energy and life & health, as well as investing its financial resources locally and internationally. More than half the company’s executive managers are Kuwait nationals.
He described GIC’s achievements in 2004, which included the company recording the highest premium income among national and non-national insurance companies for the fourth successive year, becoming lead insurer for Kuwait Petroleum Company’s insurance programmes, and the only Kuwaiti insurance company with regional subsidiaries; in Saudi Arabia, Lebanon and (since February 2005) Egypt.
In 2004, net profit rose by 13.7 per cent from KD 5.1 million (US$ 17.5 million) to KD 5.8 million(US$ 19.9 million), and Mr. Al Hassan said shareholders had enjoyed generous returns by constant increase of dividends during the last five years.
He forecast a positive outlook for the company in 2005, highlighting key opportunities with Iraq’s reconstruction, development of the northern Kuwaiti oilfields, new legislation for foreign investors, new Saudi insurance laws and Egyptian insurance market expectations. His 2005 outlook included projected business results of a 10.70 per cent increase in net profit to KD 6.4 million (US$ 21.9 million), and a rise in earnings per share to 56 fils (19 cents), compared to 53.19 fils (18.22 cents) in 2004 and 46.78 fils (16.02 cents) in 2003.
Burgan Bank chief general manager and executive officer Jonathan Lyon outlined the strategic steps taken by the bank to build the “Burgan brand,” designed around three pillars of: client delight and care; enhancing process and leveraging IT; and nurturing staff, all three pillars supporting the drive for profitable growth. This strategy had resulted in a number of innovative customer services enhancing the bank’s technology leadership.
He said the bank’s best practice in corporate governance had made it the first Kuwait Stock Exchange listed company, and one of the first regional banks, to publicly detail its corporate governance policies and procedures in its 2004 annual report.
In his review of 2004, Mr. Lyon said post restructuring, growth in interest income and improvement in costs had led to net profit increasing by an outstanding 131.5 per cent to KD 29.6 million (US$ 101.3 million), and improved performance had provided increased returns to shareholders over the past three years.
For 20005, Mr. Lyon predicted even better results including net profit rising by 191 per cent to KD 37.8 million (US$ 129.5 million), and earnings per share up by 181 per cent to 45 fils (15.4 cents).
KIPCO is Kuwait’s largest private sector company with more than US$ 15 billion under management or control and a portfolio of some 55 companies with major activities in financial services and media & telecommunications, as well as real estate, industry, management advisory, medical services and aviation throughout the Middle East and North Africa (MENA) region, and substantial ownership interests in the U.S. and Europe. KIPCO employs more than 10,000 people internationally and its shares are among the most actively traded on the Kuwait Stock Exchange.
KIPCO’s core operating companies are UGB, its investment banking subsidiary; GIC, a regional leader in commercial and personal insurance; Burgan Bank, Kuwait’s leading technology-driven commercial bank; Wataniya Telecom, the dynamic and fast-growing regional mobile telephone services provider; and Showtime, the hugely-popular digital pay-TV service spanning the Middle East and North Africa.
