UAE Outperforms GCC in Q3 2024 Corporate Earnings Amid Economic Diversification

The UAE continues to demonstrate the success of its economic diversification strategy, as corporate earnings for the third quarter of 2024 bucked the wider GCC trend of declining profits. According to Kamco Invest’s GCC Corporate Earnings Report: Q3 2024, the UAE’s listed companies showed robust growth, contrasting sharply with an aggregate decline of 3.3% in profits across GCC exchanges.

 

UAE Performance Highlights

• Abu Dhabi: Total net profits surged by 2% year-on-year (YoY) in Q3 2024, reaching $9.1 billion compared to $7.6 billion in Q3 2023.
• Dubai: Net profits grew by 4% YoY to $6.0 billion, up from $5.7 billion in Q3 2023.

This strong performance underscores the resilience of the UAE’s non-oil sectors, even as the energy sector across the GCC faced a significant decline of 18.5% YoY in profits, dropping to $28.5 billion.

 

Sector Contributions in Dubai

Earnings growth in Dubai was led by the banking, telecom, and real estate sectors, which accounted for 87.7% of aggregate profits on the exchange in Q3 2024. Out of 13 sectors listed on the Dubai Stock Exchange:

• Nine sectors recorded YoY growth in profits.
• Four sectors, including utilities and materials, posted declines.

For the first nine months of 2024, Dubai’s total net profits rose by 14.8% YoY to $18.0 billion, compared to $15.7 billion during the same period in 2023.

 

Banking and Real Estate Drive Growth

• Banking Sector:
  • Q3 2024 profits increased by 2% YoY to $2.9 billion.
  • Profits for the first nine months of 2024 grew by 4% YoY to $9.4 billion, compared to $8.5 billion in 2023.
• Real Estate Sector:
  • Q3 2024 profits improved by 0% YoY to $1.6 billion, driven by strong performance from companies like Emaar Development, which reported a 9.9% YoY increase in earnings to $563.3 million.

 

Abu Dhabi’s Key Growth Drivers

Abu Dhabi’s listed companies saw a 9.3% YoY increase in profits for the first nine months of 2024, totaling $25.2 billion.

• Banking Sector: Profits grew by 6% YoY in Q3 2024 to $2.5 billion, up from $2.1 billion in Q3 2023.
• Energy Sector: Earnings climbed by 6% YoY to $2.2 billion in Q3 2024, reflecting strong sector performance.

Other sectors, including transportation and capital goods, also contributed significantly to earnings growth in Q3 2024.

 

GCC Corporate Performance

Across the GCC, declining profits in the real estate and F&B sectors weighed down overall earnings. However, gains in the banking and materials sectors provided some relief:

• Banking Sector: Profits grew by 2% YoY to $14.9 billion.
• Materials Sector: Recorded a remarkable profit growth of 5%, reaching $5.1 billion.

For the first nine months of 2024, GCC banking profits rose by 10.7% YoY to $44.0 billion. However, the energy sector experienced a 9.8% decline, dropping to $89.1 billion.

 

Conclusion

The UAE’s corporate performance in Q3 2024 stands as a testament to the effectiveness of its economic diversification efforts, with non-oil sectors driving growth and offsetting regional declines. Key sectors such as banking, real estate, and energy continue to play a pivotal role, positioning the UAE as a resilient and dynamic economy within the GCC.