UAE’s Mubadala 2014 Profit Drops On Investment Income, Provisions

Mubadala, an Abu Dhabi state-owned fund with a mandate to develop the emirate’s economy, on Thursday said its 2014 net profit fell 28.7 per cent due to lower income from financial investments and impairments on oil and gas assets.

One of Abu Dhabi’s few state-controlled vehicles to publish results, Mubadala has interests in semiconductors, energy, aerospace and real estate among others, including General Electric and private equity firm Carlyle.

The fund said in a statement it made a net profit of Dhs1.04 billion ($283.2 million) in 2014, down from Dhs1.45 billion in the previous year.

Income from financial investments fell to Dhs1.28 billion in 2014 from Dhs3.36 billion the previous year, while Mubadala’s oil and gas provisions were worth 1.88 billion and came from joint venture blocks in the Middle East, Central and South East Asia, according to its statement.

Energy firms around the world have been booking impairments on assets because of the significant slide in oil prices in the second half of 2014. Abu Dhabi National Energy Co (TAQA), a fellow state-owned company, reported a big fourth-quarter loss on Wednesday due to such a provision.

Total comprehensive income also dropped heavily due to the revaluation of its financial investments portfolio, according to the statement, swinging to a loss of Dhs190.8 million compared to income of Dhs5.28 billion in 2013.

The fall in financial investment income and the impairments in oil and gas overshadowed a 5.3 per cent increase in total revenue, which rose to Dhs32.7 billion in 2014.

Mubadala’s total assets grew to Dhs243.6 billion at the end of 2014, up from Dhs223.8 billion in the prior year, aided by a further equity injection worth Dhs18.37 billion from the Abu Dhabi government.