Multiply Group’s third-quarter (Q3) net profit excluding fair value changes has shot up 337% to AED331 million ($90.12 million) compared to the same quarter of 2022 spurred by organic growth across its four core verticals. 

 

In Q3, 2023, the Abu Dhabi-based tech-focused holding company’s net profit including fair value changes in investments stands at AED145.77 million, a WAM report said.

 

Meanwhile, in the first nine months of 2023, the group’s year to date net profit excluding fair value changes rose to AED811.17 million, a 199% YoY growth.

 

Revenue growth

The group's Q3 2023 revenue of AED351.8 million is a 23.82% YoY growth driven by growth across its 4 core verticals (+9% YoY) and the consolidation of Media 247 and LVL effective July 1, 2023. The gross profit margin rose to 50.1%, reflecting an improvement of 128 basis points from Q3 2022.

 

This growth was bolstered by dividend income amounting to AED194.37 million from the group’s public portfolio and an increased share of profit to reflect the change in the functional currency of the Turkish JV Kalyon from Turkish Lira to USD.

 

Multiply Group remains poised to capitalise on emerging value-accretive acquisition opportunities worldwide, spanning its operating verticals and investment arm. The group boasts a robust cash position of AED1.65 billion, favourable debt-to-equity and debt-to-assets ratios, and access to over AED4 billion in financing capacity.

 

With its dual investment arms, Multiply and Multiply+, the group continues to demonstrate its financial prowess, targeting lucrative opportunities across a spectrum of asset classes. 

 

Current investment verticals

Multiply’s current investment verticals encompass Mobility, Energy and Utilities, Media and Communications, and Beauty and Wellness. Meanwhile, Multiply+ remains sector-agnostic, aiming for double-digit returns across asset classes. Under Multiply+, the public market portfolio is currently valued at AED33.28 billion, compared to an initial investment of AED15.43 billion.

 

On the sustainability front, Sustainalytics, a global leader in environmental, social and governance (ESG) rating and research, has rated Multiply Group’s risk level at 15.8. This commendable rating places the Group in the “Low Risk” category, positioning it among the top 10% of companies in the Diversified Financials sector. This is a testament to our commitment to sustainability.

 

Multiply Group successfully acquired a 55% majority stake in Media 247, a leading UAE outdoor advertising firm, at an investment of AED225 million. Media 247, known for its extensive portfolio of over 45 exclusive outdoor premium hoardings, unipoles, and 3D structures across Dubai’s most prominent locations, solidifies Multiply Group’s position in the media vertical. In H1 2023, Media 247 overachieved both revenue and profitability targets, highlighting its strong financial capabilities.

 

In a move to bolster its footprint in the wellness domain, MG Wellness Holding, the wellness-centric subsidiary of Multiply Group, secured a 49.38% equity interest in LVL Technology Holding in August. LVL Technology Holding is renowned for its LVL Wellbeing platform, which offers a comprehensive suite of individual, team, and corporate well-being solutions, championing a balanced work-life dynamic. 

 

Amplifying operations

This strategic investment is poised to amplify operations and bolster regional expansion. Furthermore, the integration of HealthierU into the LVL Wellbeing platform has created a holistic offering, positing it as the region’s premier source for preventative health and well-being services for its clientele.

 

Under Multiply+ arm, Multiply Group invested AED367 million for a minority stake in EIG’s Breakwater Energy which owns 25% interest in Repsol E&P, a North American-based gas-weighted exploration and production company. Through this acquisition, Multiply+ taps into a highly profitable and cash generative, diversified global upstream portfolio offering a highly attractive dividend profile.

 

Emirates Driving Company (EDC) registered a 14.15% net profit increase YoY driven by favourable revenue mix and higher interest income versus last year. In line with the expansion strategy into new markets, EDC’s board approved the investment in the Consultants Driving School in KSA by signing a convertible notes agreement with a total value of SR10 million. Further details to be disclosed subject to financial and legal approvals. Furthermore, the company achieved the ISO 31000 certificate for its risk management system and the company hosted the 11th National Dialogue for Climate Ambition in partnership with the UAE Ministry of Climate Change and Environment (MOCCAE).

 

Wellness and Beauty

Omorfia Group, Multiply Group’s Wellness & Beauty vertical, reported a 22.18% net profit growth YoY driven by gross margin expansion on favourable revenue mix and a spike in interest income. The company expanded its flagship brand, Tips & Toes, by inaugurating two new branches in Abu Dhabi and Dubai. With a network of 40 branches across the UAE and Saudi Arabia, Tips & Toes is positioned as the region’s largest and most successful salon and spa chain. Additionally, Bedashing Beauty Lounge, with its 23 branches, was celebrated as the UAE’s favourite beauty salon in the FACT Spa & Wellness Awards 2023, continuing its expansion and enhancing its comprehensive beauty services across the country.

 

Pal Cooling Holding (PCH), a leader in the UAE’s district cooling industry, reported a flat YoY profit growth as the double-digit growth in revenue on new connections was countered by higher finance costs and additional expenses related to the commissioning of the first phase of Tamouh district cooling plant’s expansion (additional capacity of 5,000 RT). 

 

During the quarter, PCH successfully connected the new Nord Anglia School in Reem Island, with a 1,250 RT cooling load requirement, to its Tamouh district cooling plant. With the impending second phase due for completion this year, the plant’s total installed capacity will reach 75,000 RT. Moreover, PCH’s upcoming Danat district cooling plant will feature a design capacity of 37,500 RT, elevating PCH’s total design capacity to a staggering 257,000 RT, with an installed capacity of 183,000 RT, across its seven plants.

 

Viola Communications

Viola Communications, a fully-integrated marketing and communications solutions provider, reported a 84% net profit growth YoY led by significant increase in agency services revenues and higher occupancy of Out-Of-Home (OOH) media assets. The company marked its presence among the top 100 event organisers and agencies in 2023 on the prestigious Eventex index, becoming the only UAE agency to earn this distinction. 

 

The agency cinched five awards for its campaign for Abu Dhabi Department of Community Development’s Abu Dhabi Moments, an integrated initiative designed to help foster a sense of belonging amongst communities. Furthermore, Viola Communications secured nominations for the Mena Digital Awards in the “Best Integrated Digital Campaign” and “Best Use of Social Media” categories.

 

In a strategic partnership with Atlantis Dubai, LVL Wellbeing is set to offer guests an immersive wellness experience. Whether guests seek relaxation, workouts, or sound healing, they can now access exclusive content through in-room TVs and the state-of-the-art digital well-being studio at Atlantis Dubai’s AWAKEN Spa. This initiative complements the AWAKEN Wellness programme, marking a first for Dubai's hospitality sector.

 

As part of its "Cleaning up the Oceans" initiative, Multiply Group made a significant environmental impact by extracting 30,000 pounds of plastic waste from the world’s oceans during the Year of Sustainability. This initiative not only supports the global ocean and coastline clean-up efforts but also aligns with the objectives of the upcoming COP28 environmental summit. In partnership with US-based 4ocean, the group is ambitiously targeting the offset of more than 100,000 pounds of plastic waste by the close of 2023.--TradeArabia News Service