Abu Dhabi’s largest industrial investment holding company, Senaat reported a rise in earnings in the first six months of the year, compared with the same period last year. After a challenging 2015, the Group’s net profit grew to Dh 341 million in the six months ended June 30, 2016 from Dh321 million in the comparable period.

However, the revenues slipped to Dh6.4bn in line with management expectations from Dh7.3 billion. A challenging business environment, both in the UAE and globally, affected the Group’s revenues, including pressures linked to the impact of oil prices, downturn in the global steel industry with overcapacity driving down prices, and a general retrenchment in core economic activity in Abu Dhabi and the UAE.

In spite of these adverse fundamentals, Senaat achieved solid financial results driven by the strong performance of its portfolio companies, prudent financial management including rationalisation of costs and its sound corporate strategy. In comparison to the six months ended 30 June 2015 Senaat’s profit was slightly down and margin decreased marginally by 1 per cent.

Commenting on the Group’s performance, Hussain Jasim Al Nowais, chairman of Senaat, said: “In spite of the challenges faced both domestically and globally, Senaat remains confident in its financial position. The strong performance of our portfolio companies, as well our senior management’s strategy of implementing internal cost controls have enabled us to remain in a strong position as we enter the second half of the year.

Looking ahead, Senaat will continue to pursue opportunities to optimise its portfolio, maximise value for its shareholder and share wealth with citizens of the nation. This includes realising and re-investing profits, and growing its existing portfolio and creating new industrial leaders. We look forward to what the second half of the year will bring for Senaat as we work to achieve these goals.”

Senaat’s portfolio companies reported strong earnings for H1 2016. Amongst the portfolio are two companies that are publicly listed on the local stock exchange.

ADX-listed food and beverages company Agthia Group PJSC was a standout performer, reporting a 16 per cent increase in net profit to Dh145 million for H1 2016. Agthia’s strong financial performance was driven by a 15 per cent year-on-year increase in revenues achieved with better profitability margins.

Arkan Building Materials PJSC, also listed on ADX, demonstrated resilient performance in an oversupplied market and recorded a commercial performance below last year due to a weather-related incident that had a negative, but limited impact on operations at one of the company’s cement plants. The company continues to maximise its production efforts and marketing its products across the country.

H1 2016 also saw the progression of major projects for the Group, including the April 2016 ground-breaking of the Al Gharbia Pipe Company plant, a joint venture between Senaat and Japanese partners JFE Steel Corporation and Marubeni-Itochu Steel Inc.

The facility will be the first sour service capable, welded steel pipe plant in the UAE, and will have an expected production capacity of 240,000 tonnes annually