Earnings of GCC corporates fell 5% in 2009 - Markaz

Aggregate earnings of GCC listed companies showed a second consecutive year of declines in 2009, a new report from Kuwait Financial Centre (Markaz) has said.

With more than two-thirds of firms declaring results so far, aggregate results show a decline of five percent for GCC as a whole for last year, Markaz said.

The report said fourth quarter earnings plummeted due to a correction in real estate prices in Qatar, UAE, and Kuwait.

It added that the debt crisis in Dubai "led to greater provisioning by banks against credit losses and impairment in the value of investments and adversely impacted banking earnings during 4Q09".

On a year-on-year basis, earnings in the financial services and real estate sectors took the largest hit, down 67 percent and 64 percent, respectively in 2009.

GCC banks earnings declined one percent last year primarily due to last quarter dip in earnings, Markaz said, adding that the telecom sector registered a seven percent year-on-year decline.

Markaz said Saudi Arabia performed "in line with our expectations", registering growth of 26 percent in its earnings while the UAE’s corporate earnings declined 32 percent.

Kuwait registered an earnings growth of 29 percent in 2009 while Qatar saw growth of 14 percent year-on-year.

The report said Bahrain was the worst performer for the year in the GCC region, due in part to steep losses reported by Gulf Finance House while Oman’s earnings shrank by 14 percent.