OER presents its annual ranking of the Sultanate’s Top 20 Listed Companies of 2008
THE OER TOP TWENTY – Year 2008 Oman Economic Review presents its annual report on Oman’s Top 20 listed companies for the year 2008 or the sixth consecutive year, 2008 has been fairly positive for Oman’s economy in general due to the growth in the first half of 2008. The price of oil continued to increase during the earlier part of the year 2008. Oman crude realised an average price of $101.06 per barrel in 2008 compared with an average price of $65.15 for 2007 and the budgeted price of $40 per barrel for 2008. The original total appropriations for the year 2008 of RO5,800mn were substantially increased by a further RO603mn to implement a number of development and basic infrastructure projects. Due to the higher oil prices the actual budget was projected to close with a budgetary surplus of RO1,581mn as against a projected deficit of RO400mn.
Suhail Salim Bahwan Ex-chairman, NBO
Market meltdown However, due to the global financial meltdown, 2008 has been quite challenging for the Muscat Securities Market (MSM). You may recall from our statement last year that due to the bursting of the ‘Credit Bubble’ in a
The top five by revenue – 2008 Rank
Company
year that was full of bad news for developed markets, emerging markets spent 2007 on another planet, with returns of 35 per cent to 40 per cent. This phenomenon continued till the middle of 2008 but hit home with a vengeance in the second half of 2008. The MSM ended the year as the fourth best performing stock market in the GCC with an overall decline of 40 per cent. Two successful IPOs were launched during the first half of the year with unprecedented oversubscription of more than 25 times. Trading volumes amounted to RO3,710mn in 2008 compared to RO2,321mn in 2007, an increase of 59.8 per cent. The benchmark MSM 30 index ended the year at 5,441 points, a loss of 39.78 per cent for the year. The top performer was the services and insurance sector which was down 28 per cent followed by the industry sector which lost 45 per cent and the banking
The top five by profit – 2008 Revenue RO Mn
Growth % from 2007
Rank
Company
Profit RO Mn
Growth % from 2007
1
Oman Telecommunications Co
411.49
12.74
1
Omantel
119.24
5.93
2
Galfar Engineering & Contract
364.36
35.45
2
Bank Muscat
93.73
11.24
3
Bank Muscat
338.15
27.13
3
National Bank of Oman
45.38
1.71
4
Shell Oman Marketing
326.36
31.60
4
Oman International Bank
29.47
4.98
5
Oman Cables
304.57
39.62
5
Raysut Cement Company
27.10
(10.00)
48 OMAN ECONOMIC REVIEW May 2009
CoverStory Story Cover period found that those that made the biggest leaps in profitability were often the ones that increased their spending on acquisitions and innovation the most amid recessions.
Sultan Bin Hamdoon Al Harthy Chairman, Omantel and investment sector was the worst hit ending with a decrease of 46 per cent. Foreign participation in the capital of the listed joint stock companies also reduced during the year to 23.84 per cent compared to 27.55 per cent last year, a decrease of about 13 per cent. Due to higher oil prices in the first half of the year, increased non-oil exports and strong demand, the GDP growth rate for 2008 is estimated at 10 per cent. Oil production increased in 2008 by about seven per cent. The government’s continued emphasis on diversifying the economy away from dependence on oil gained further momentum during 2008. Non oil exports grew by 27 per cent. Most of the real estate development projects started in 2007 continued and the
tourism sector grew by 22 per cent. Performance of western world financial markets continued to be greatly affected due to the worldwide recession. MSCI AC World index was down 43.5 per cent in 2008 as global equity markets finished 2008 down 43.5 per cent. Japan (-30.5 per cent) was the best performing region followed by the USA (-38.5 per cent) and Europe (-48.2 per cent). The worst performing regions were Global Emerging Markets (-54.5 per cent) and Asia Pac ex-Japan (-53.3 per cent). Recessions are historically times when companies make the biggest competitive strides or fall behind. A 2002 survey by McKinsey of the performance of 1000 companies during an 18 year
The top five by growth of profit – 2008 Rank
Company
During the year 2008, the revenues of Oman’s 20 largest companies showed a handsome growth. Total revenues for the OER Top 20 went up by 25 per cent to RO3,220mn. Corporate performance of the year 2008, overall, was also slightly positive in spite of the global recession. The profits for the year 2008 increased by four per cent to RO480mn from the figure of RO462mn last year. The total market cap of the OER Top 20 on December 31, 2008 was RO3,975mn, which was down by 44 per cent compared to 2007. On April 2, 2009, the market cap of the top twenty has once again gone down to RO3,281mn. The OER Top 20 companies represent 68 per cent to the total market cap of the MSM of RO5,829mn at the end of 2008. The average P/E ratio of the OER Top 20 based on the profits of the year 2008 and the share price on April 2, 2009 is 6.84 times earnings.
Who is out and who is in We have two new comers on the list this year. Oman Flour Mills comes into the number 18 spot and Al Hassan Engineering is back in the number 20 slot after missing out last year. These companies have made it to the OER Top 20 this year at the expense of AES Barka and Oman Refreshment. The ranking of Oman’s 20 largest companies in order of revenue produces a
The top five highest capitalised – 2008 Growth % from 2007
Rank
Company
Shareholders Equity RO Mn
1
Al Anwar Holdings
99.86
1
Bank Muscat
715
2
Oman Flour Mills
91.97
2
Omantel
373
3
Oman Holdings International
51.21
3
National Bank of Oman
245
4
Renaissance Services
51.06
4
Bank Dhofar
188
5
Areej Vegetable Oils
24.50
5
Oman International Bank
173
49 OMAN ECONOMIC REVIEW May 2009
Cover Story list, which includes the seven companies from the banking and investment sector, six from the services sector and seven from the industrial sector.
Bank Muscat is the second most profitable company in Oman as well as the third largest company in Oman based on turnover for the year 2008. Bank Muscat has achieved this position by recording growth in profit for the year of about 11.24 per cent.
There has been no change in the top ten companies in Oman by revenues. Omantel continues to be the largest public company in Oman with a growth in revenue of 12.74 per cent compared to last year. The Chairman of Omantel Eng. Sultan Bin Hamdoon Al Harthy in his report to the shareholders explains that the main reason for good growth in net profit is the continuous double digit revenue growth. Al Harthy states that the total group revenue rose by 12.6 per cent. Al Harthy outlines that the total group net profit after tax rose by 5.9 per cent to RO118.6mn. Al Harthy adds that the total subscriber base has recorded a growth of 13.4 per cent. The total number of subscribers has increased to 2.119mn compared to 1.869mn last year. Al Harthy goes on to state that due to the global financial crisis and the deteriorating market conditions in Pakistan, the value of their strategic investment in Worldcall Telecom has been affected and the group has recognised an impairment loss of RO18.88mn. Without this impairment the net profit would have been RO137.5mn, a growth of 22.8 per cent. Al Harthy cautions that during the year 2009 the sector liberalisation is likely to intensify with the TRA announcement of awarding Oman’s second fixed line
Abdul Malik al Khalili Chairman, BankMuscat network and possible award of more Internet service providers in 2009. He adds that the government plan to sell 25 per cent of its stake in Omantel to a strategic investor has been called off because of the current conditions in the global capital markets.
Profit index Similar to last year, three of the top five most profitable companies in Oman are banks. As expected in the current economic climate four of the five companies are showing a small growth in profits for the year whereas one is showing a decline. There is one change in the top five companies by profit. Raysut Cement, which was in the fourth place last year, has moved down to the number five position and OIB is up from five to four. Omantel continues to remain at the number one spot, Bank Muscat at the number two spot and NBO at number three.
The top five largest market capitalisation – Apr 2, 2009 Rank
Company
The Chairman Abdul Malik bin Abdullah al Khalili states in his yearend report to the shareholders that despite the global financial crisis the key business lines of the bank continued to turn in an impressive performance in 2008. Khalili adds that during 2008, the return on average assets was at 1.8 per cent compared to 2.3 per cent in 2007. The return on average equity was 14.8 per cent in 2008 compared to 25.8 per cent in 2007 and the basic earnings per share was RO0.087 as against RO0.090 in 2007. Khalili explains that their strategic shareholding in Saudi Pak Commercial Bank was impaired due to the deteriorating economic situation in Pakistan and even though this investment is strategic in nature as a measure of prudence the bank has provided for an impairment loss of RO17mn for this investment. Khalili goes on to say that the Board has proposed a dividend of 50 per cent, 20 per cent in the form of cash and 30 per cent in the form of mandatory-convertible bonds. He advises that the 2009 financial market environment appears to be challenging for business with tight liquidity conditions, weak equity market and tightened lending norms by banks. Khalili is confident that the bank
The top five returns on equity – 2008
Market Capitalisation RO Mn
Rank
Company
Profit as a % of Equity
1
Omantel
881
1
Shell Oman Marketing
46.62
2
Bank Muscat
629
2
Omantel
31.99
3
National Bank of Oman
299
3
Oman Oil Marketing
30.06
4
Bank Dhofar
269
4
Al Anwar Holdings
28.14
5
Oman International Bank
258
5
OMINVEST
28.09
50 OMAN ECONOMIC REVIEW May 2009
Cover Story will sail through these turbulent times.
Tops turvy Al Anwar Holdings has shown the highest growth in profits by an enormous 99.86 per cent and has remained in the number one spot for the second year running. Three of the top five companies showing highest growth of profit from last year being Oman Flour Mills, Renaissance and Areej Vegetable Oil are new on the list. Al Jazeera Steel, OMINVEST and Al Maha Petroleum have all dropped off this list. The Chairman of Al Anwar, Masoud Humaid Al Harthy in his report to the shareholders for the year ended March 31, 2008 has stated that new business strategies; investment policies and procedures; and risk management tools introduced by the management in the second half of the year has contributed in the continued sustainable growth of the company. The group has recorded 100 per cent growth in profits over last year achieving its highest ever net profit of RO4.33mn for the year ended March 31, 2008. He points out that out of this profit RO1.13mn is generated from disposal of 31 per cent shareholding in NAPCO. The board has recommended a cash dividend of eight per cent and a stock dividend of 12.93 per cent. Al Harthy adds that the group’s subsidiaries Voltamp Manufacturing and Sun Packaging are all performing well as are its associates NAPCO, Al Anwar Blank, Falcon Insurance, Al Maha Ceramics and Addax Securities Saudi Arabia. Al Harthy explains that the group contin-
Samir Fancy Chairman, Renaissance Services ues to focus on the financial services and real estate sectors. Four of the top five companies that have the highest amount of equity employed are banks. Four of the companies in this category remain the same as last year. BankMuscat continues to remain number one in this category. Omantel and NBO continue to remain in the same position as they were last year. Bank Dhofar, a newcomer on the list, comes in at number four knocking OIB down to the number five position. Oman Cement which was number five last year is no longer on this list. The then chairman of NBO Suhail Salim Bahwan in his report to the share-
The top five earnings per share – 2008 Rank
Company
holders states that the bank’s net profit of RO45.4mn exceeds last year’s record net profit of RO44.6mn despite a very turbulent fourth quarter and after impairment charge of RO3.7mn on investments. Bahwan adds that the profit from operations grew by 49 per cent from RO36mn to RO54mn reflecting the bank’s clear emphasis on sustainable growth. He explains that the bank has diversified its income as reflected in ratio of other operating income to total income which increased from 37 per cent in 2007 to 46 per cent in 2008. Business efficiency remained an important focus and the improvement in cost to income ratio continues to improve. The recoveries and releases against the provisions for 2008 were at RO16.6mn.
The top five by share price growth – 2008 Earnings per share growth %
Rank
Company
Share price growth %
1
Oman Flour Mills
91.76
1
Oman Oil Marketing
16.03
2
Al Anwar
63.33
2
Shell
10.53
3
Renaissance Services
32.05
3
Al Hassan
8.26
4
Oman Holdings International
31.02
4
Omantel
(8.56)
5
Shell
13.02
5
Al Maha
(9.09)
52 OMAN ECONOMIC REVIEW May 2009
Total assets ended the year at RO1.9bn. This growth was linked to the growth in deposits by RO406mn (43 per cent) and growth in net advances by RO494mn (54 per cent). Bahwan goes on to say that 2009 will pose significant challenges in the international debt and capital markets. The global economy is expected to continue to suffer under the impact of a prolonged recession. In the GCC region, lower oil prices are expected to slow the growth in the region. Bahwan states that the bank will continue to grow in a prudent and profitable manner by targeting quality assets in Oman and the UAE with the overall objective of enhancing shareholder value.
Sea change This year, only one of the top five companies that have the highest market capitalisation on the MSM is not a bank. Omantel has taken over from Bank Muscat as the number one this year; BankMuscat has slipped to the number two spot in this category. NBO is a newcomer to this list straight into third place, Bank Dhofar has jumped up one place to the fourth position and OIB is a newcomer in the number five position. Raysut Cement and Galfar who were number three and four last year are both knocked out from this list. The chairperson of Oman International Bank, Reem Omar Zawawi in her annual report to the shareholders states that 2008 was another successful year for the bank with record profitability. Zawawi
Andrew Wood, Chairman, Shell Oman Marketing adds that the business philosophy of the bank is to continue to deliver consistent returns to the shareholders backed by a determination to pursue growth with prudent risk management. Zawawi explains that the bank achieved a net profit of RO29.47mn for the year 2008 compared to RO28.07 for 2007, an increase of 4.97 per cent. The bank commands a market share of 8.23 per cent for deposits and 7.4 per cent for loans and 7.77 per cent for total assets as at December 31, 2008 as per the consolidated statistics from the Central Bank of Oman. In the light of these results the board of directors has proposed a cash dividend of 27 per cent. Zawawi states that the bank looks to the
The best five by dividend yields – 2008 Rank
Company
Dividend Yield per cent
1
Oman Flour Mills
121.95
2
Oman Holdings International
25.00
3
Oman International Bank
12.27
4
Al Hassan Engineering
11.01
5
Raysut Cement
9.07
54 OMAN ECONOMIC REVIEW May 2009
future with conservatism, confidence and optimism. The government policies continue to focus on strong economic growth with expenditure up 11 per cent and revenue by four per cent. In the future the bank will increase its delivery channels in terms of new state of the art branches, ATMs, PoS (point of sales) and customer friendly mobile banking services. She adds that the bank will make optimum use of these channels to redefine customer convenience and thereby acheive continous sustainable growth. Interestingly, only one of the top five companies showing the best return on equity employed comes from the banking sector. Four of the companies in the top five are newcomers to the list. Shell steps up to the number one spot from being No.2 last year; Omantel, Oman Oil, Al Anwar and OMINVEST take the two to five positions knocking out Oman Cables, AES Barka, OHI and Raysut Cement who appeared in this table last year. Andrew Wood, Chairman of Shell Oman Marketing, in his report to the shareholders states that overall the company remained the market leader amongst oil marketing companies op-
Cover Story erating in Oman. Wood adds that the company achieved unprecedented financial results recording a historically highest ever net profit of RO12.5mn compared to previous year’s net profit of RO11.06mn. Despite the uncertainty surrounding the major economies and Oman’s economy, proactive management as well as sound operational performance were the principal drivers of the commendable financial performance in 2008. Wood explains that the retail business remains the most important segment for the company. Total retail volumes sold was in excess of 1.3bn litres. The aviation business saw over 50 per cent increase in volumes in 2008. The market penetration in the lubricants market also registered record level of sales volume. The board has recommended a final dividend of 115 per cent for the year continuing the recent trend of year on year dividend growth. Wood adds that the fuels market normally follows the economic trend of the country and is
Reem Omar Zawawi, Chairperson, Oman International Bank thus expected to see some uncertainty due to the volatility of the global oil prices. The Sultanate will not be entirely immune from the current global
recession and demand, especially in the commercial and aviation sectors which, may be affected as tourism and development projects slow down. The
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retail segment on the other hand is not expected to be affected. Three of the top five earnings per share growth companies are newcomers on this list. Oman Flour Mills jumps straight into number one spot pushing Al Anwar down to the second position. Renaissance comes in at the number three position, OHI continues to remain in the number four position and Shell comes into the number five spot. Al Jazeera Steel, OMINVEST and Al Maha Petroleum are all out. Samir Fancy, Chairman of Renaissance, in his report to the shareholders states that Renaissance has achieved record results for the seventh consecutive year. The consequence of continued focus on values-driven operating model is, yet another year of growth and record financial performance. Revenues of RO234mn are up from RO199mn in 2007. Revenue increased by 17.6 per cent, operating profit has increased by 35.8 per cent and operating margins improved from 13.8 per cent in 2007 to 16 per cent in 2008. The net profit of 2008 includes a capital gain of RO4.8mn from the divestment of the group’s former technology business. For the current fiscal year the board has recommended a cash dividend of 10 per cent and a stock dividend of 15 per cent. Looking ahead, Fancy states that it is clear that the prognosis for Renaissance is good for continued growth in 2009, in spite of the recession. As usual, performance will not be even across each quarter. The first quarter of the year we have usual seasonal effect of winter downtime in the northern Caspian and in Q1 and Q2, 2009 we have a major programme of dry-docking that will ensure Q3 and Q4 will likely record the best financial performances of the year ahead. Going into 2009, Fancy states that the company does not underestimate the challenges of the recession but is taking all prudent measures necessary to avert its dangers. He further states that they have the right 56 OMAN ECONOMIC REVIEW May 2009
Manal Mohammad Al Abdawani, Chairperson, Oman Flour Mills businesses, with the right customers, in the right markets and have the right assets and above all the right people.
Role reversal All of the five companies on the shareprice growth list are newcomers with Oman Oil taking the top position. Shell Marketing comes in second followed by Al Hassan Engineering, Omantel and Al Maha Petroleum. Al Anwar Holdings, Renaissance Services, Oman Cables, Bank Dhofar and Raysut Cement from last year have all been knocked out. Salim Abdullah Al Rawas, Chairman of Oman Oil Marketing in his report to the shareholders states that 2008 was another successful year for the company. The total revenue increased by 11 per cent to RO170mn from the previous year’s 152.7mn. The revenue growth was due to improved sales recorded for most products as well as higher product prices in line with the international prices. As a result the company’s pre-tax profit rose by 12 per cent to RO7.2mn. The board of directors recommended a final dividend of 35 per cent for the financial year 31 December 2008. Al
Rawas states that the outlook for the coming year appears to be positive with the demand for petroleum products expected to grow in line with Oman’s projected economic growth. He adds that the company has placed itself in a strong position for the future. Nonetheless competition in all business sectors particularly in the retail business will continue to persist. With ever increasing competition in the market and aggressive efforts by the competitors, the company will remain focused on expanding its network of facilities, improving quality of its products and services, optimising costs and developing its human capital even further. Three new companies have entered the ranking of the best five dividend yield companies. Oman Flour Mills, Al Hassan and Raysut Cement are newcomers in number one, four and five slots. OHI jumps up to number two from number five last year and OIB retains the third position. Manal Mohammad Al Abdawani, Chairperson of Oman Flour Mills in her report to the shareholders for the year ended June 30, 2008 states that while there has been remarkable improvement in
Cover Story the demand for their flour products, which increased by six per cent in the local market compared to last year, the company’s fodder sales fell by eight per cent compared to previous year because of the shortage of fodder raw material. The total sales amounted to 324,000 metric tons which covers 65 per cent of the flour market in the Sultanate. Al Abdawani adds that the company exerted relentless efforts to improve its operating performance. The com-
pany achieved impressive results for the year ended June 30, 2008. The net profit for the year was RO7.5mn compared to RO4mn for the previous year an increase of 87 per cent. The company along with its subsidiaries made a net profit of RO8.1mn compared to RO4.2mn in the previous year. Based on the good results achieved, the board has recommended a dividend of 25 per cent for the year. Al Abdawani explains that the company is continu-
ing to improve operating efficiency through diversifying its investments in equipment like the ship un-loader that increases the discharge capacity thereby reducing cost. The company is also working to add other equipment in order to improve overall production efficiency. The company has also established a subsidiary ‘Bread House’ to market frozen bakery products and will establish an industrial bakery, the commercial production of which is expected to commence in 2009.
METHODOLOGY The figures and the lead analysis for the listing was done by Mukhtar Hasan. He is a Fellow of the Institute of Chartered Accountants in England and Wales and holds a Corporate Finance Qualification issued jointly by this Institute together with the Securities Investment Institute and the Chartered Accountants of Canada. Currently, he is on the board of several public companies, including Gulf Investment Services, Gulf Mushroom and Muscat Thread Mills in Oman.
for this purpose. In the case of insurance companies, the gross premium written as well as investment income together is considered as their revenue for this purpose. All figures are for the year ended 31 December 2008, unless otherwise stated.
The data has been verified by KPMG – a global network of professional firms providing audit, tax, and advisory services. They operate in 144 countries and have more than 137,000 professionals working in member firms around the world. KPMG is one of the leading accredited accounting firms in Oman and has more than 100 employees including 3 Partners, 3 Directors, and 21 Managers. KPMG Oman has 23 Omanis who are currently training for ACCA. KPMG has many years of experience in the Middle East. They have a reputation for providing quality professional services to well-diversified client portfolio, both in public and private sectors.
Shareholders’ Equity
DEFINITIONS AND EXPLANATIONS Revenues: All companies on the list are derived from the published accounts submitted to the Muscat Securities Market (MSM). Therefore, closed Joint Stock Companies and private companies and establishments are excluded from this list. These companies are, in the first instance, ranked by Revenues. All the other rankings shown on the table do not consider any other companies that do not make the list on the basis of Revenue. In the case of banks the gross interest income as well as other operating income together is considered as their revenue
Profits Profits are shown after taxes and all charges including extraordinary charges. Figures in brackets indicate a loss. All losses and negative growth are also ranked where possible.
Assets Assets shown are as per the balance sheet at the end of the year. It is the total of Fixed as well as the current assets.
Shareholders Equity is the paid up capital of the company, retained earnings, and statutory and all other reserves as well as share premium.
Market Cap Market capitalisation figure has been arrived at by multiplying the total number of outstanding shares of the company by the price per share as of close of business on April 2, 2009.
Earnings per share The earnings per share are as declared by the company in its published financial statements.
Dividend Yield The dividend yield figure is calculated on the basis of dividend declared in the financial statements for 2008 against the share price at close of business on 31 December 2008.
Price Earnings ratio This ratio has been calculated by dividing the price per share by the earnings per share as at December 31, 2008. 57 OMAN ECONOMIC REVIEW May 2009
THE OER TOP 20 COMPANIES FOR 2008 Rank Company
Revenue
Profit as % of revenues
Profits
Growth 2008 2007 2008 2007 Growth % % from Rank Rank (RO MN) (RO MN) (RO MN) (RO MN) from 2007 2007
2008 2007
Profit as % assets
Profit as % equity
%
Rank
%
Rank
%
Rank
1
1
OMAN TELECOMMUNICATIONS CO.
411.49
365
12.74
119.24
113
1
5.93
10
28.98
6
20.19
3
31.99
2
2
2
GALFAR ENGINEERING AND CONTRACTING *1
364.36
269
35.45
23.11
22
8
4.31
13
6.34
13
6.23
11
27.73
6
3
3
BANK MUSCAT * 2
338.15
266
27.13
93.73
84
2
11.24
8
27.72
7
1.55
20
13.11
17
4
4
SHELL OMAN MARKETING COMPANY
326.36
248
31.60
12.50
11
11
13.04
6
3.83
16
21.41
2
46.62
1
5
5
OMAN CABLES INDUSTRY
304.37
218
39.62
6.13
15
16
(59.48)
20
2.01
19
4.46
14
19.02
13
6
6
RENAISSANCE SERVICES *3
234.26
199
17.72
26.19
17
6
51.06
4
11.18
10
7.04
10
20.91
11
7
7
AL MAHA PETROLEUM
191.65
175
9.52
7.34
7
14
7.08
9
3.83
15
15.76
5
26.64
9
8
8
OMAN OIL MARKETING COMPANY
170.04
153
11.14
6.32
6
15
11.31
7
3.72
17
15.59
6
30.06
3
9
9
NATIONAL BANK OF OMAN
130.83
101
29.54
45.38
45
3
1.71
15
34.68
3
2.29
17
18.49
14
10
10
OMAN HOLDINGS INTERNATIONAL * 4
91.10
73
25.07
8.80
6
12
51.21
3
9.66
11
9.71
8
27.54
8
11
16
AREEJ VEGETABLE OILS & DERIVATIVES *5
90.67
53
71.08
1.50
1
20
24.50
5
1.66
20
4.88
12
23.20
10
12
11
RAYSUT CEMENT COMPANY
89.08
63
41.37
27.10
30
5
(10.00)
17
30.43
4
23.04
1
27.64
7
13
13
BANK DHOFAR * 6
80.57
65
23.96
23.68
23
7
3.93
14
29.40
5
1.79
19
12.57
18
14
17
AL JAZEERA STEEL PRODUCTS COMPANY
78.43
45
74.30
1.71
2
19
5.42
11
2.19
18
2.15
18
5.53
20
15
15
OMAN CEMENT COMPANY
63.52
50
27.05
12.54
17
10
(27.38)
19
19.74
8
9.43
9
10.63
19
16
12
OMAN INTERNATIONAL BANK
59.31
68
(12.77)
29.47
28
4
4.98
12
49.69
1
2.89
15
17.08
16
17
14
OMINVEST * 7
54.41
59
(7.78)
20.37
27
9
(24.24)
18
37.45
2
2.60
16
28.09
5
18
N/A OMAN FLOUR MILLS COMPANY *8
50.74
35
45.64
8.06
4
13
91.97
2
15.89
9
17.22
4
19.59
12
19
19
45.37
37
22.62
4.33
2
17
99.86
1
9.55
12
12.89
7
28.14
4
20
N/A AL HASSAN ENGINEERING COMPANY
45.03
35
27.89
2.02
2.1
18
(4.58)
16
4.49
14
4.48
13
17.14
15
AL ANWAR HOLDINGS *9
NOTES 1. Galfar has issued a 20% stock dividend, which has not been taken into account in the calculation of the dividend yield. 2. Bank Muscat has issued a 30% convertible bonds as dividend, which has not been taken into account in the calculation of dividend yield.
58 OMAN ECONOMIC REVIEW May 2009
3. Renaissance Services has issued 15% stock dividend, which has not been taken into account in the calculation of dividend yield. 4. The financial statements of OHI are as at 31 March 2008, which is their financial year-end. OHI has issued 5.56% stock dividend, which has not been taken into account in the calculation of dividend yield.
k
Cover Story
Earnings per share
Dividend yield
Dividend per share
Share price Sector
2008 (RO)
2007 (RO)
Growth %
Rank
2008 %
2007 %
Growth %
2008 (RO)
2007 (RO)
Rank
0.158
0.149
6.04
7
6.30
5.80
8.56
0.100
0.100
9
Services
1.588
1.724
(8.56)
4
1.175
7.44
0.092
0.103
(10.68)
14
4.32
2.74
57.45
0.020
0.040
12
Services
0.463
1.458
(214.90)
16
0.464
5.04
0.087
0.090
(3.33)
10
2.51
2.70
(7.10)
0.020
0.050
17
Banking & Inv
0.797
1.851
(132.25)
13
0.584
6.71
0.125
0.111
13.02
5
6.44
6.88
(6.46)
0.115
0.110
8
Services
1.786
1.598
10.53
2
1.751
14.01
0.068
0.169
(59.76)
19
2.23
1.50
48.94
0.020
0.040
18
Industry
0.896
2.669
(197.88)
14
0.739
10.87
0.103
0.078
32.05
3
1.61
1.15
40.65
0.010
0.015
20
Services
0.620
1.308
(110.97)
12
0.463
4.50
1.065
1.140
(6.58)
12
4.13
3.03
36.36
0.500
0.400
13
Services
12.100
13.200
(9.09)
5
9.006
8.46
0.098
0.088
11.36
6
2.89
4.68
(38.13)
0.035
0.048
15
Services
1.210
1.016
16.03
1
1.175
11.99
0.042
0.049
(14.29)
15
4.79
23.31
(79.43)
0.018
0.175
11
Banking & Inv
0.365
0.751
(105.67)
11
0.277
6.60
0.735
0.561
31.02
4
25.00
4.88
412.50
0.250
0.200
2
Banking & Inv
1.000
4.100
(310.00)
17
1.000
1.36
0.436
0.525
(16.95)
16
8.00
1.78
350.00
0.080
0.080
6
Industry
1.000
4.500
(350.00)
18
1.000
2.29
0.136
0.151
(9.93)
13
9.07
5.01
80.87
0.100
0.100
5
Industry
1.103
1.995
(80.87)
8
1.026
7.54
0.044
0.043
2.33
9
4.07
3.72
9.27
0.015
0.025
14
Banking & Inv
0.369
0.672
(82.11)
9
0.380
8.64
0.014
0.023
(39.13)
17
2.65
0.00
2.65
0.007
0.000
16
Industry
0.264
0.432
(63.64)
7
0.220
15.71
0.022
0.532
(95.86)
20
7.31
4.22
73.11
0.022
0.270
7
Industry
0.301
6.395
(2024.58)
20
0.352
16.00
0.032
0.031
3.23
8
12.27
51.84
(76.33)
0.027
0.210
3
Banking & Inv
0.220
0.405
(84.14)
10
0.283
8.84
0.046
0.096
(52.08)
18
2.04
3.89
(47.48)
0.010
0.030
19
Banking & Inv
0.490
0.772
(57.55)
6
0.273
5.93
0.512
0.267
91.76
1
121.95
8.00
1424.39
0.250
0.200
1
Industry
0.205
2.500
(1119.51)
19
0.315
0.62
0.049
0.030
63.33
2
5.67
1.14
395.89
0.008
0.005
10
Banking & Inv
0.141
0.437
(209.93)
15
0.172
3.51
0.027
0.028
(3.57)
11
11.01
12.00
(8.26)
0.012
0.012
4
Industry
0.109
0.100
8.26
3
0.190
7.04
5. Areej Vegetable has declared a stock dividend of 33.3% which has not been taken into account in the calculation of dividend yield. 6. Bank Dhofar has issued a stock dividend of 4.5%, which has not been taken into account in the calculation of dividend yield. 7. OMINVEST has declared a stock dividend of 11.1%, which has not been
31-Dec-08 31-Dec-07 (RO per sh) (RO per sh)
Growth %
P/E ratio
Rank 2-Apr-09 2-Apr-09
taken into account in the calculation of dividend yield. 8. The Financial statements of Oman Flour Mills are as on June 30, 2008, which is their financial year end. 9. Al Anwar has declared a stock dividend of 12.93%, which has not been taken into account in the calculation of dividend yield.
59 OMAN ECONOMIC REVIEW May 2009
Exceeding customer expectations safely and profitably
RENAISSANCE SERVICES
True blue mNC
Renaissance Services results reflects the group’s strengths and resilience The numbers speak for themselves – Renaissance Services has revenues in excess of $0.6bn, employs over 10,000 people, operates in over 16 countries and has shown an outstanding growth record in all economic cycles. It owns and operates a combined Offshore Support Vessel (OSV) fleet of 96 vessels – one of the largest in the world.
Milestones 1. The operating margins of the company improved from 13.8 per cent to 16 per cent in a year hampered by severe inflationary pressure.
Stephen Thomas CEO, Renaissance Services “2008 has been a year of exceptional achievement for Renaissance, as the group responded to the powerful global forces shaping the world economy and took decisive action to secure and sustain our growth path through turbulent economic times in the years ahead. Our company has achieved record financial results for the seventh successive year and a fourth consecutive year of improved safety performance.”
2. Topaz Marine acquired Doha Marine Services for $127mn thereby increasing its OSV fleet size by 14 vessels and strengthening its spread in the Northern Gulf. Topaz Marine has kept its entire fleet 100 per cent operational during the recession. 3. The Contract Services Group was awarded two major contracts by Petroleum Development Oman to build, own and operate new Permanent Accommodation for Contractors facilities in Oman’s interior oilfields at Marmul and Bahja. The long term contracts run until 2044 with an initial 5-year value of $91mn. 4. BUE Marine was awarded a 10-year $225mn contract for three support vessels for BP Azerbaijan. 5. Strategic divestment of the Technology business for $41mn, strengthening the group’s core oil & gas focus.
Numbers at glance Revenue (in million)
Growth - 17.72%
250 225
RO234.26
200
RO199
175 150 125 100 75 50
Looking Ahead
6
The year 2008 proved that Renaissance Services is on the track of both stellar and sustainable growth. The company is proving its resilience to the global recession and credit crunch, citing its ‘customer-centric’ philosophy as its hook line, and its alignment with blue chip industry clients in key markets for its long term success strategy. Renaissance Services is one of the very few Omani companies that bring in profits from outside Oman as well as from its continued development within the country. Renaissance is built on values of integrity and transparency that is manifest in its distinct corporate personality.
66 OMAN ECONOMIC REVIEW May 2009
25
2007
0
Profit (in million)
2008
Growth - 51.06%
50 45 40 35 30
RO26.19
25 20
RO17
15 10 5 0
2007
OER TOP 20 RANK
2008 2007 - 6
2008 - 6
ASSET SIZE
BREAKING IT DOWN A ranking of companies on individual parameters throws up a different perspective highlighting the individual strengths of various companies *All figures are for 2008 except where it is specified.
Rank
Oman Flour Mills Company
In % 91.76
2
Al Anwar Holdings
63.33
3
Renaissance Services
32.05
DIVIDEND YIELD
EPS GROWTH
1
Company
In RO Mn
1
Bank Muscat
6028.23
2
National Bank of Oman
1984.48
3
Bank Dhofar
1323.82
4
Oman International Bank
1018.19
5
OMINVEST
784.33
6
Oman Telecommunications Co.
590.68
7
Renaissance Services
372.16
8
Galfar Engineering and Contracting
371.14
9
Oman Cables Industry
137.52
10
Oman Cement Company
132.98
11
Raysut Cement Company
117.64
12
Oman Holdings International
90.71
13
Al Jazeera Steel Products Company
80.08
14
Shell Oman Marketing Company
58.40
15
Oman Flour Mills Company
46.80
16
Al Maha Petroleum
46.62
17
Al Hassan Engineering Company
45.05
18
Rank
Company
Oman Oil Marketing Company
40.55
19
Al Anwar Holdings
33.61
20
Areej Vegetable Oils & Derivatives
30.82
Rank
Company
In %
1
Oman Flour Mills Company
121.95
2
Oman Holdings International
25.00
3
Oman International Bank
12.27
4
Al Hassan Engineering Company
11.01
4
Oman Holdings International
31.02
5
Shell Oman Marketing Company
13.02
5
Raysut Cement Company
9.07
Areej Vegetable Oils & Derivatives
8.00
Oman Cement Company
7.31
6
Oman Oil Marketing Company
11.36
6
7
Oman Telecommunications Co.
6.04
7
8
Oman International Bank
3.23
8
Shell Oman Marketing Company
6.44
2.33
9
Oman Telecommunications Co.
6.30
(3.33)
10
Al Anwar Holdings
5.67
11
National Bank of Oman
4.79
9 10
Bank Dhofar Bank Muscat
11
Al Hassan Engineering Company
(3.57)
12
Al Maha Petroleum
(6.58)
12
Galfar Engineering and Contracting
4.32
13
Al Maha Petroleum
4.13
13
Raysut Cement Company
(9.93)
14
Galfar Engineering and Contracting
(10.68)
14
Bank Dhofar
4.07
15
Oman Oil Marketing Company
2.89
15
National Bank of Oman
(14.29)
16
Areej Vegetable Oils & Derivatives
(16.95)
16
Al Jazeera Steel Products Company
2.65
Bank Muscat
2.51
Oman Cables Industry
2.23
17
Al Jazeera Steel Products Company
(39.13)
17
18
OMINVEST
(52.08)
18
19
Oman Cables Industry
(59.76)
19
OMINVEST
2.04
20
Renaissance Services
1.61
20
Oman Cement Company
84 OMAN ECONOMIC REVIEW May 2009
(95.86)
Company
In RO Mn
1
Oman Telecommunications Co.
2
Bank Muscat
119.24 93.73
3
National Bank of Oman
45.38
4
Oman International Bank
29.47
5
Raysut Cement Company
27.10
6
Renaissance Services
26.19
7
Bank Dhofar
23.68
8
Galfar Engineering and Contracting
23.11
PROFITS AS A % OF ASSETS
Rank
Rank
Company
In %
1
Raysut Cement Company
23.04
2
Shell Oman Marketing Company
21.41
3
Oman Telecommunications Co.
20.19
4
Oman Flour Mills Company
17.22
5
Al Maha Petroleum
15.76
6
Oman Oil Marketing Company
15.59
7
Al Anwar Holdings
12.89
8
Oman Holdings International
9.71
9
OMINVEST
20.37
9
Oman Cement Company
9.43
10
Oman Cement Company
12.54
10
Renaissance Services
7.04
11
Shell Oman Marketing Company
12.50
11
Galfar Engineering and Contracting
6.23
12
Oman Holdings International
8.80
12
Areej Vegetable Oils & Derivatives
4.88
13
Oman Flour Mills Company
8.06
13
Al Hassan Engineering Company
4.48
14
Al Maha Petroleum
7.34
14
Oman Cables Industry
4.46
15
Oman Oil Marketing Company
6.32
15
Oman International Bank
2.89
16
Oman Cables Industry
6.13
16
OMINVEST
2.60
17
Al Anwar Holdings
4.33
17
National Bank of Oman
2.29
18
Al Hassan Engineering Company
2.02
18
Al Jazeera Steel Products Company
2.15
19
Al Jazeera Steel Products Company
1.71
19
Bank Dhofar
1.79
20
Areej Vegetable Oils & Derivatives
1.50
20
Bank Muscat
1.55
Rank
Company
In %
1
Shell Oman Marketing Company
46.62
2
Oman Telecommunications Co.
31.99
3
Oman Oil Marketing Company
30.06
4
Al Anwar Holdings
28.14
5
OMINVEST
28.09
6
Galfar Engineering and Contracting
27.73
7
Raysut Cement Company
27.64
PROFITS AS A % OF REVENUE
PROFITS AS A % OF EQUITY
PROFITS
Cover Story
Rank
Company
In %
1
Oman International Bank
49.69
2
OMINVEST
37.45
3
National Bank of Oman
34.68
4
Raysut Cement Company
30.43
5
Bank Dhofar
29.40
6
Oman Telecommunications Co.
28.98
7
Bank Muscat
27.72
8
Oman Holdings International
27.54
8
Oman Cement Company
19.74
9
Al Maha Petroleum
26.64
9
Oman Flour Mills Company
15.89
10
Areej Vegetable Oils & Derivatives
23.20
10
Renaissance Services
11.18
11
Renaissance Services
20.91
11
Oman Holdings International
9.66
12
Oman Flour Mills Company
19.59
12
Al Anwar Holdings
9.55
13
Oman Cables Industry
19.02
13
Galfar Engineering and Contracting
6.34
14
National Bank of Oman
18.49
14
Al Hassan Engineering Company
4.49
15
Al Hassan Engineering Company
17.14
15
Al Maha Petroleum
3.83
16
Oman International Bank
17.08
16
Shell Oman Marketing Company
3.83
17
Bank Muscat
13.11
17
Oman Oil Marketing Company
3.72
18
Bank Dhofar
12.57
18
Al Jazeera Steel Products Company
2.19
19
Oman Cement Company
10.63
19
Oman Cables Industry
2.01
20
Al Jazeera Steel Products Company
20
Areej Vegetable Oils & Derivatives
1.66
5.53
85 OMAN ECONOMIC REVIEW May 2009
Company
In RO Mn
1
Oman Telecommunications Co.
881
2
Bank Muscat
629
3
National Bank of Oman
299
4
Bank Dhofar
269
PROFIT GROWTH
Rank
Rank
Company
In %
1
Al Anwar Holdings
99.86
2
Oman Flour Mills Company
91.97
3
Oman Holdings International
51.21
4
Renaissance Services
51.06
5
Oman International Bank
258
5
Areej Vegetable Oils & Derivatives
24.50
6
Raysut Cement Company
205
6
Shell Oman Marketing Company
13.04
7
Shell Oman Marketing Company
175
7
Oman Oil Marketing Company
11.31
8
Galfar Engineering and Contracting
116
8
Bank Muscat
11.24
9
Renaissance Services
108
9
Al Maha Petroleum
7.08
10
Oman Oil Marketing Company
76
10
Oman Telecommunications Co.
5.93
11
Oman Cables Industry
66
11
Al Jazeera Steel Products Company
5.42
12
Al Maha Petroleum
62
12
Oman International Bank
4.98
13
OMINVEST
49
13
Galfar Engineering and Contracting
4.31
14
Al Jazeera Steel Products Company
27
14
Bank Dhofar
3.93
15
Al Anwar Holdings
15
15
National Bank of Oman
1.71
16
Al Hassan Engineering Company
14
16
Al Hassan Engineering Company
(4.58)
17
Oman Cement Company
12
17
Raysut Cement Company
(10.00)
18
Oman Holdings International
9
18
OMINVEST
(24.24)
19
Oman Flour Mills Company
5
19
Oman Cement Company
(27.38)
20
Areej Vegetable Oils & Derivatives
3
20
Oman Cables Industry *S
(59.48)
Rank
Company
In %
1
Oman Oil Marketing Company
16.03
2
Shell Oman Marketing Company
10.53
3
Al Hassan Engineering Company
8.26
4
Oman Telecommunications Co.
(8.56)
5
Al Maha Petroleum
(9.09)
6
OMINVEST
(57.55)
7
Al Jazeera Steel Products Company
8 9
SHAREHOLDERS EQUITY
SHARE PRICE GROWTH
MARKET CAP AS ON APRIL 2, 2009
Cover Story
Rank
Company
In RO Mn
1
Bank Muscat
714.75
2
Oman Telecommunications Co.
372.79
3
National Bank of Oman
245.38
4
Bank Dhofar
188.43
5
Oman International Bank
172.59
6
Renaissance Services
125.31
(63.64)
7
Oman Cement Company
117.93
Raysut Cement Company
(80.87)
8
Raysut Cement Company
98.05
Bank Dhofar
(82.11)
9
Galfar Engineering and Contracting
83.32
10
Oman International Bank
(84.14)
10
OMINVEST
72.53
11
National Bank of Oman
(105.67)
11
Oman Flour Mills Company
41.14
12
Renaissance Services
(110.97)
12
Oman Cables Industry
32.23
13
Bank Muscat
(132.25)
13
Oman Holdings International
31.97
14
Oman Cables Industry
(197.88)
14
Al Jazeera Steel Products Company
31.06
15
Al Anwar Holdings
(209.93)
15
Al Maha Petroleum
27.58
16
Galfar Engineering and Contracting
(214.90)
16
Shell Oman Marketing Company
26.81
17
Oman Holdings International
(310.00)
17
Oman Oil Marketing Company
21.03
18
Areej Vegetable Oils & Derivatives
(350.00)
18
Al Anwar Holdings
15.39
19
Oman Flour Mills Company
(1119.51)
19
Al Hassan Engineering Company
11.78
20
Oman Cement Company
(2024.58)
20
Areej Vegetable Oils & Derivatives
6.48
86 OMAN ECONOMIC REVIEW May 2009