- Revenue of QR 3 billion for the year ended 31 December, 2016
- Total Assets of QR 11.1 billion, slightly down by 1% on 31 December, 2015
- Continuous cost and operation optimization measures across the group
DOHA, QATAR - Gulf International Services (“GIS” or “the group”; QE: GISS), the largest services group in Qatar, with interests in a broad cross-section of industries, ranging from insurance, re-insurance, onshore and offshore drilling, accommodation barge, helicopter transportation, and catering services, announced its financial results for the year ended 31 December, 2016, with a revenue of QR 3 billion and a net profit of QR 67 million.
Group revenue for the year ended December 31, 2016 was QR 3 billion (compared to QR 4.2 billion for the same period of 2015). This reduction was driven by the downward rates-revision and reduced level of activities across all segments of the group due to the challenging market conditions faced by the group companies. Revenue in the drilling segment was significantly impacted by the lower daily rates and utilization of rigs following the plunge in crude oil price, which has adversely affected most of the GDI contracts. Aviation segment revenue was also down on 2015 primarily due to lower flying hours.
Insurance segment revenue reduced mainly due to non-renewal of contracts of some of the major medical insurance clients. Catering segment’s revenue were moderately affected due to demobilization of some contracts and lower rates on new contracts. Nonetheless, the group is planning to work with a consultant to develop corporate strategy that will focus on identifying the growth opportunities, and to develop plans to execute those strategies.
Group net profit for the year ended December 31, 2016 closed at QR 67 million (compared to QR 801 million for the same period of 2015). Earnings per share was QR 0.36 for the year ended December 31, 2016. The impact on the profitability was due to a significant revenue reduction primarily in the drilling segment despite a notable improvement in the operating costs. Operating costs have improved significantly to partially offset the decline in revenue.
Performance Improvement Efforts
The group is actively engaged in a series of initiatives to better utilize the asset base and to decrease its operating costs across the group companies. These initiatives include identification and short listing of a number of new opportunities, and further rationalization of the costs together with optimizing the utilization of operating assets and the supply chain.
Proposed Dividend Distribution
For the period from the initial public offering in February 2008 to 2015, the group’s shareholders have received accumulated cash dividends of QR 2.5 billion, which is equivalent to circa QR 13.3 per share, with an average payout ratio of approximately 52%. In addition, shareholders have received a total of 63 million additional shares through three bonus issuances. The Board of Directors, after considering the operating, investing, and the financing needs of business, is pleased to recommend a dividend distribution for the year ended December 31, 2016 equivalent to a payout of QR 1.0 per share.