Investment Corporation of Dubai announces 21.4% dip in 2016 net profit

Investment Corporation of Dubai (ICD), the holding company of some of the emirate’s key businesses and institutions, has announced a 21.4 per cent fall in net profit attributable to its shareholder the Dubai government for 2016.

The company said the net profit decrease to Dhs18bn ($4.9bn) was due to competitive pressure on yields in its transportation segment, which includes Dubai airline Emirates.

The carrier posted an 82 per cent drop in profit to Dhs1.3bn ($354m) in the year to March 31, its first annual decline in five years.

Read: Emirates airline posts 82% drop in annual profit

ICD said it also had a prior year gain on discontinued operations resulting from the sale of US maintenance firm Standard Aero Inc by Dubai Aerospace Enterprises.

Revenue for the year ending December 31, 2016, decreased 0.5 per cent to Dhs176.3bn ($47.9bn) and general net profit was down 19.6 per cent to Dhs22.1bn ($6bn).

“In 2016, the portfolio of ICD demonstrated resilience by delivering a strong operational and financial performance despite challenging market conditions,” said Mohammed Ibrahim Al Shaibani, executive director and CEO of ICD.

“ICD remains focused on expanding its capabilities and investing in opportunities that will support long-term growth and enhance the prosperity of Dubai,” he added.

In its wider results, ICD’s assets increased 6.9 per cent to Dhs769.9bn ($209.6bn).

The holding company attributed the growth to rising loans and receivables under its banking and financial services segment, which includes local banks Emirates NBD, Dubai Islamic Bank and Commercial Bank of Dubai, and aircraft fleet upgrades under its transport segment.

The firm’s liabilities increased 7 per cent to Dhs560.5bn ($152.6bn) due to higher customer deposits in the banking and financial services segment and its share of equity increased by 7.2 per cent due to operating profits.