Muscat Finance SAOG ($MFCI)

Ladies and gentlemen, I would extend a warm welcome to all of you to the MSX discussion session focused on the audited and approved financial statements for the year ended 31st December 2025 of Muscat Finance. I would also like to thank you and express my appreciation for your presence with us today. We look forward to an informative and interactive session through your valuable questions and inquiries on the matters to be presented during this session. Before we begin, allow me to introduce you my executive colleagues present with us today. Mr. Rashad Al Shaikh, Chief Executive Officer; and Mr. Tammar Hassan [indiscernible] Head of Finance and Accounts. Thank you once again for joining us, and we are pleased to begin this informative and interactive session. And now I'll hand over to Mr. Tammar.

Thank you. Thank you, [indiscernible]. Thank you for the brief introduction. Just a quick question. Is my screen visible?

Yes, sir.

Yes. Perfect. Thank you. Thank you, everyone. Thank you for joining this particular session, which is for the financial year ended 31st December 2025. We'll basically be taking you through this presentation, which basically tells us about the history of the company, our workforce, our branch networks, other areas, along with the snapshot for the year ended 31st December 2025, along with the overall performance for the year and what are the way forward and which are accompanying with the annexures at the end of this report, and then we will open the floor for the questions. Let me begin with the normal disclaimer at the beginning of this presentation. This presentation contains statements relating to Muscat Finance business, financial condition and results of operations from published information. Any statement or comment which has a meaning of prospect or forward-looking are only predictions and are not guarantees of future performance and does not constitute any solicitation to buy or sell any product, services, stock or to engage in any trading strategy and should not be relied upon or considered as an advice for making any investment decision. As due caution must be exercised that any such forward-looking statements or comments are and will be subject to both known and unknown risks, uncertainties and factors relating to the operations and business environment of the company that may cause the actual results of the company to be materially different from the future results expressed or implied in such forward-looking statements. This presentation and discussion are only for information purpose. Any recipient of this presentation and discussion media must not communicate, reproduce, distribute or disclose through media or refer to them publicly or privately in whole or in part any time without written consent of the company. So as we all know that Muscat Finance is the first FLC in Oman, which was incorporated in the year 1987. The company was listed on the stock exchange on 24th of June 1995. Our major shareholders is FinCorp, Zawawi, Al Yousef, Hooria and rest of the members as well. We have 9 Board members in total, and the company operates through its network of 6 branches located in different Wilayat of Oman like Sohar, Sur, Barka, Ibri, Nizwa and Salalah. We are having 123 full-time employees with 90% plus of Omanization, out of which 44% is the female staff. We have 24/7 fully automated kiosk, which is forced in the FLC sector and a drive-through service for the customer convenience. As at 31st of December, we hold approximately 9.4% of the gross loan and advances. During the year 2025, the auditors have issued the unmodified clean audit opinion. We maintained the highest level of corporate standards -- corporate governance standards. There were no penalties, fines imposed by any regulator or authority during the year '25. We have contributed towards the CSR in the year 2025 as well. The operations of the company has turned into profit, which has made the company to pay the cash dividends for the year 2025 as well. Our operating profit has increased approximately by 45% and the profit before tax was increased to 53%. In this slide, we would like to discuss about the snapshot for the year 2025. The net investment in the [indiscernible] is amounting to OMR 102.4 million as in relation to OMR 100.8 million of the year 2024. Our product includes vehicle financing, equipment financing, home plan and working capital facilities for the SMEs and the retail customers. The corporate deposits has amounted to OMR 38.51 million, which has approximately increased by 57% as in relation to the year 2024. The bank borrowings in contrast to that has dropped from OMR 32 million to OMR 30 million, which is a net drop by 7%. The company is having a strong equity as at year-end, which is OMR 39.4 million. The leverage ratio remains to be at 1.98 as in contrast to 1.93 as of previous year, which allows us to have ample space to grow as in relation to the regulatory limit of 5x. The gross income has also increased by 18% from OMR 9.97 million to OMR 11.75 million in the year 2025. The net interest income has also grown by 18% from OMR 5.6 million to OMR 6.6 million for the year '25. In a similar fashion, the net profit has also increased by 53% from OMR 0.915 to OMR 1.4 million. The company remains prudent for the provision coverage where we have provided approximately -- we have reached to 85% of the provision coverage and the total provision is OMR 37.4 million as relation to 2024, OMR 32.97 million. If we look at the overall financial performance for the year ended 31st December 2025, our net loan and advances has grown by 2%. However, the gross loan has increased by 5%. The other assets, including the cash and bank has increased by 71% and the major increase was because of our well-placed investment in the bonds. The overall liabilities has increased by OMR 9.9 million from [OMR 58 million] to [OMR 68 million]. The other liabilities have reduced by 48% and the equity has increased by [OMR 354,000] in terms of net basis. The operating income has increased by 18%. However, the interest expense, including all the other operating expenses have increased by 7% and the operating profit of the company before the ECL has increased by OMR 1.2 million from OMR 2.8 million to OMR 4.4 million, which is approximately 45%. The ECL has also jumped up by OMR 770,000 from OMR 1.886 million to OMR 2.6 million. The profit before tax was reported at OMR 1.4 million from OMR 915,000 of previous year, which is an increase by 53%. The net profit has only increased by 3% from OMR 828,000 to OMR 855,000 for the year 2025. Now this slide will basically tell us about the growth trajectory over the period of 3 years. If you look at the gross loan and advances, which has increased by approximately 5% from OMR 133,000 to OMR 139,000 in the year 2025. The gross income and the net interest income has also increased by 18%. The gross income was standing at OMR 9.9 million as at 31st of December '24, which has grown to OMR 11.75 million. The operating profit has been consistently growing for the last 3 years. From OMR 2.8 million in the year 2024, it has grown to OMR 4 million, which is approximately 45% of it. Over the period of 2 years, the company has doubled its operating profit where it used to be at OMR 1.9 million based on the audited financials of 2023 as compared to the reported operating profit for the year 2025. The profit before tax has also shooted up by 53% from OMR 915,000 to OMR 1.4 million. The operating expenses more or less for the last 3 years remained consistent, and the ECL provision has increased by 40% as compared to the year 2024. Now for the way forward, the company will keep on focusing -- to grow the volume by focusing on all products in order to regain the market share with an improved yield. Our focus would be to -- our focus would remain on the collection and recoveries by managing the stressed account efficiently. We'll manage the staff cost and the other overhead costs in order to have the consistent profitability over the period. We will be having the funding diversification in terms of bond program and the deposit neutralization. We'll increase the new book loans with a focus on the retail and the vehicular business. Here is the abstract of the statement of financial position, where line by line, it tells that what are the differences or the delta between the year 2024 and 2025. The overall asset base has increased by 6% and the overall equity has increased by OMR 354,000, whereas the overall liabilities has gone up by OMR 5.5 million. The major shift would be in terms of corporate deposit where it has drastically increased from OMR 24 million to OMR 38 million. And at the same time, the overall liabilities from the banking lines have dropped and the liabilities have reduced from OMR 9 million to OMR 4.5 million. As we have discussed in the earlier slides as well, this is the abstract of the statement of profit and loss and other comprehensive income, where our gross -- our interest income has increased by 17% and the overall gross income has also increased by 18%. The overall net interest margin has also increased to the extent of 18%. The overall expenses remained consistent as compared to the previous year. The operating profit from OMR 2.8 million has been reported to OMR 4 million, which is a jump of 45%. The ECL allowance has increased from OMR 1.8 million to OMR 2.6 million. And the net profit for the year before tax is OMR 1.4 million as in relation to OMR 915,000 of the previous year. The net profit after tax is OMR 855,000 for the financial year 2025. Now I would open the session for any questions if you have, and we would be more than happy to answer.

So we will be waiting for another minute. If there are no further questions, we will kindly conclude this session. We look forward to seeing you in all of our upcoming discussion sessions in the near future, and you may connect with us to ask any further questions. Thank you.

Probably there is no question at the moment. So maybe we can conclude this session.

Okay. So thank you all, and thank you to Mr. Rashad and Mr. Tammar and all who is present today. And we will look forward to seeing you all in our upcoming discussion sessions in the near future. Thank you all again.