Alijarah Holding (Q.P.S.C.) (NLCS) Earnings Call Transcript & Summary

Good day, and welcome to the National Leasing Company, Alijarah Holding Q1 2022 Results Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Ms. Pia Vergara. Please go ahead, ma'am.

Good afternoon, everyone. I am Pia Vergara, the accounting supervisor of Alijarah. And with me is Mr. Rami Soussou, our CFO. We are here to present to you today the financial results of National Leasing for Q1 2022. If you have the presentation with you, you can go with me to Slide #4, which shows the performance of the company for the quarter 1 2022. As you can see in the presentation, the revenue from core business for Q1 2022, it dropped by 37% from QAR 9.9 million last year to QAR 7.2 million this year. And this is mainly due to the decrease in revenue recognized for the percentage of work completed from Lusail project. As mentioned in our previous conference call, we have reached the handing over stage on this project and currently no transaction in this project, except for a few handovers that needs to be completed with the contractors. The next graph in the same slide shows that we reported earnings per share of QAR 0.006 in Q1 2022 compared to loss per share of QAR 0.012 in Q1 2021. And this is directly related to a higher investment income since the investment securities are reported in accordance with IFRS 9, wherein any changes in fair value of financial assets are recognized to profit or loss. And the same goes for the profit for the period. We have reported a profit of QAR 2.95 million this year compared to QAR 6.08 million of loss last year. And this is also directly related to investment in financial assets. Moving on to the details of our income statement in Slide #5. Our total revenues and income increased from QAR 8.77 million last year compared to QAR 19.69 million this year due to the same reasons mentioned earlier. Our expenses as well, total operating and general and admin expenses, it has increased by QAR 1.89 million this year. And our net operating income for the year is QAR 2.26 million compared to a net operating loss of QAR 6.77 million last year. Another impact is from net finance income that increased by QAR 200,000 this year, and this is mainly due to the increase in deposit rates comparing Q1 of this year to last year. As mentioned earlier, we have reported a profit of QAR 2.95 million this year compared to QAR 6.08 million of loss last year. Moving forward to company's financial position in Slide #6. Our total assets dropped by QAR 3.66 million in Q1 2022 that includes the following: there's a decrease in cash of QAR 30 million attributed between the additional investment in equity securities and payment to Lusail contractors, our suppliers and Wakalah repayment. As you have noticed, our investment securities, it is increased by QAR 29.4 million. And the QAR 2.23 million is attributed between the sale of assets held for sale and depreciation related to property, plant and equipment. And the remaining QAR 1.2 million is related to the decrease in installments induced from customers and prepayments and other receivables. Our total liabilities also decreased by QAR 3.67 million attributed between Wakalah repayment, release of retention to contractors related to Lusail project, payment to suppliers and subcontractors and decrease in contract liabilities. Our total equity has increased by QAR 10,419, basically due to the profit for the period of QAR 2.86 million and loss on investment securities with a change in fair value through other comprehensive income of QAR 2.85 million. Moving forward to the cash flow in Slide #7. The cash used in operating activities for Q1 2022 is QAR 5.85 million, which is directly related to what I have mentioned earlier that is supplier payments and retention payments of contractors. The net cash outflow used in investing activities is QAR 17.95 million associated to the QAR 34.9 million purchase of investment securities, QAR 5.97 million proceeds from disposal of investment securities. And we have cash received from dividends amounting to QAR 9.14 million, finance income from deposits of QAR 975,000 and sale of vehicles amounting to QAR 1 million. The net cash used in financing activities of QAR 5.75 million is linked to repayment of Wakalah and dividends paid to shareholders. And this gave us a total decrease in cash and cash equivalents of QAR 29.5 million in Q1 2022. This sums up the performance of Alijarah for Q1 2022. And we are now ready if there's any questions. Thank you.

[Operator Instructions] We will take our first question from Talal Samhouri from Aventicum Capital.

Can you please elaborate more on what's your growth expectations over the coming quarter?

This is Ram speaking. Thank you, Talal, for your question. Well, going forward, as you have seen and that we clarified in the presentation, we're moving on with the strategy of the Board, investing the funds that we have between different aspects. The first one was increasing our investment in security by approximately QAR 30 million, which should have a positive impact on our financial statements in the next quarter and the quarters going forward. And step by step, hopefully, we'll be able to complete this strategy from -- to the -- until the year-end and going forward for the next years, hopefully. I hope I answered your question, Talal. Thank you.

[Operator Instructions] It appears that there are no question at this time. I would like to turn the conference back to Ms. Vergara for any additional or closing remarks.

Yes. Thank you, everyone, for participating for today's call, and we are looking forward to see you all again in the next quarter's conference call. Thank you.

This concludes today's call. Thank you for your participation. You may now disconnect.