Banks post solid 1Q 2024 earnings

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WHAT WE’RE TRACKING TODAY

THIS MORNING: Updates on potential acquisitions from ADQ and Borouge + Barcelona FC could get funds from Dubai investors

Good morning, wonderful people, and welcome to a brisk issue as we wrap up a busy week.

The big stories here at home include fresh trade and macro figures from Vice President Sheikh Mohammed bin Rashid Al Maktoum, as well as news that Bayanat and Yahsat’s merger has received shareholder approval, and a host of strong bank earnings.

PUBLIC SERVICE ANNOUNCEMENTS-

#1- We’re in for another foggy weekend, with skies expected to be clouded by rain and light fog until Sunday, the National Center of Meteorology said on X. Temperatures will hover around highs of 33°C in Dubai today and 36°C tomorrow, with overnight lows of 24°C. In Abu Dhabi, expect a higher chance of rain and highs of 36°C, with an overnight low of 20°C.

#2- Reports of water contamination have surfaced in a small number of cases in thecountry after heavy rainfall, with the exact number undisclosed, the Health Ministry said. The ministry did not reveal a cause for the contamination but did mention that the affected individuals received hospital treatment for their symptoms.

#3- There’s a new health office in town: The Dubai Health Authority has established adisaster and crisis management office to ramp up the emirate’s health security system, focusing on readiness and capabilities for emergencies, according to a statement. The office will develop and manage the emergency, crisis, and disaster system with support from the recently launched Dubai Disaster and Crisis Medicine Programme, which aims to train some 10k government and private healthcare professionals over five years on emergency response skills. It will also be tasked with rolling out preventive strategies and training specialists to address disasters.

#4- Schools in Sharjah are returning to in-person classes as of Monday, Wam reports. Schools in the emirate had temporarily moved online due to last week’s storms and flooding.

WATCH THIS SPACE-

#1- KKR and Co. won’t sell Upfield to ADQ: Private equity firm KKR and Co. has shelved the sales process for Flora and Country Crock spreads maker Upfield, after negotiations with Abu Dhabi sovereign wealth fund ADQ fell through over price disagreements, Bloomberg reports, citing people with knowledge of the matter. The buyout firm, which had planned to raise USD 10 bn from the sale, is now considering retaining Upfield for longer, in addition to an IPO or minority stake sale, as Upfield drew “muted interest” from private equity bidders, the sources added.

#2- Borouge-Borealis merger facing more delays? Talks between the Abu Dhabi National Oil Company (Adnoc) and Austria-based integrated oil and gas company OMV on a planned merger of ADX-listed Borouge and Borealis could continue to face delays until after Austria’s national elections in the fall, Bloomberg reports, citing several people with knowledge of the matter. The agreement, initially announced in July, is expected to be worth some USD 30 bn as the two companies create a combined petrochemical holding entity.

The sticking points: OMV is reportedly “resisting” injecting some EUR 1.7 bn into the merger to ensure an equal stake to Adnoc in the new entity, while Adnoc is reportedly resisting a push from the Austrian side to see the merged company listed on a second exchange, Bloomberg’s sources say. Meanwhile, Borealis CEO Thomas Gangl — “an advocate of the [transaction]” — has resigned from his position, which has impacted the progression of the negotiations, Bloomberg says.

#3- Barcelona FC is reportedly in talks with unnamed Emirati investors to secure a funding agreement, as the football club looks to secure additional income, Asharq Business reports, citing Spanish newspaper Mundo Deportivo. The club is looking for a funding alternative after the failure of its agreement with German company Libro Football Finance, which bought a 10% stake in Barca Vision for EUR 60 mn but failed to fulfill payment commitments.

HAPPENING THIS WEEK-

Lord Mayor Michael Manielli will be in the UAE this week to discuss carbon markets and debt finance for vulnerable countries with officials, in a bid to follow up on the progress made during Cop28, where he led a delegation to the summit, he told The National. The exact agenda for his visit was not disclosed.

The Abu Dhabi Mobility Week kicked off on Wednesday. The event, which is being organized by the Department of Municipalities and Transport, is geared towards developing the transportation landscape in Abu Dhabi. Hosting representatives from Abu Dhabi Department of Economic Development, Abu Dhabi Airports, Etihad Rail, Etihad Airways, and other sector players, the event closes on 1 May.

OUR NEXT CONFERENCE IN CAIRO-

Foreign investors are falling in love with Egypt again… Foreign investors we speak with (debt, equity, and strategic alike) have growing appetite for Egypt. They’re buying into local debt, eyeing promising shares, and committing bns of USD to both new ventures here and the growth of their existing businesses. They like the Egypt story that’s taking shape after the float of the EGP, and its competitive advantages are clear to many of them: It’s a massive consumer opportunity and a regional export hub of tomorrow.

The Enterprise Optimism Forum 2024 will do exactly what it says on the tin: Spark conversations about a future that sees Saudi Arabia, Egypt, and the the UAE at the heart of a more vital Middle East economy — and provide an early, actionable roadmap for those who are “long Egypt.”

We’ll be talking with you about the agenda over the coming couple of weeks.It features speakers from Egypt and abroad who are future-proofing their businesses and angling to capture tomorrow’s opportunities — and who aren’t afraid to answer some tough questions.

*** Interested in attending? Tap or click here to let us know. Seating is limited.

THE BIG STORY ABROAD-

Earnings season still dominates front pages in the Western business press, with yesterday seeing Big Tech report 1Q 2024 results. The highlights:

#1- Google parent Alphabet announced its first ever dividend payout and a plan to buy back USD 70 bn in shares, after beating forecasts with revenues coming in at USD 80.54 bn (pdf). The dividend payout, which comes after Meta announced its first dividend earlier this year, sent shares soaring 16% after the bell — setting it up for a more than USD 2 tn valuation. (Reuters)

#2- Microsoft also beat estimates as AI investments bear fruit, with revenues rising 17% y-o-y to USD 61.9 bn and net income rising to USD 21.9 bn, according to its earnings release.

#3- Snap saw its shares jump 25% in after hours trading after beating analyst expectations with a 21% y-o-y increase in revenues to USD 1.2 bn, according to its earnings release.

#4- The one outlier was Intel, which missed analyst expectations as it suffers weakened demand for its PC chips and traditional data centers, as more companies eye more advanced AI server chips. Shares in Intel fell 8% following the results, which showed revenues of USD 12.72 bn during the quarter.

IN OTHER BUSINESS NEWS- TikTok parent ByteDance said it would rather shut down its business in the US than sell it if push comes to shove and it is unable to legally fight US President Joe Biden’s legislation to ban the app from US app stores. Sources said the parent company would not want to give up its algorithm, which are core to its operations. (Reuters)

CIRCLE YOUR CALENDAR-

The World Economic Forum’sSpecial Meeting on Global Collaboration, Growthand Energy for Development is scheduled for next Sunday and Monday, 28-29 April in Riyadh, Saudi Arabia. The two-day meeting addresses global challenges in economic development, including energy transitions and geopolitical tensions.

It will feature over 700 participants, including Economy Minister Abdulla Bin Touq, who will sit on a panel covering the rise of the tourism sector, and Majid Al Futtaim Holding CEO Ahmed Galal Ismail, who is participating in a panel on MENA economic perspectives.

The International Congress of Arabic Publishing and Creative Industries, hosted by the Abu Dhabi Arabic Language Centre, will convene next Sunday, 28 April at Manarat Al Saadiyat in Abu Dhabi, according to the Abu Dhabi Media Office. The event will feature speakers from 50 countries to discuss Arabic literature and creative works.

Binghatti Development Company is set to unveil the details of Binghatti Hills, the largest development project in Dubai’s skyline, next Monday, 29 April at the Four Seasons Resort Dubai at Jumeirah Beach, followed by a four-day sales event, Albayan reports. The project will comprise 1.6k residential units and 21 commercial outlets.

The Abu Dhabi International Book Fair is set to take place from 29 April to 5 May at the Abu Dhabi National Exhibition Centre (Adnec), with Egypt as the guest of honor and Egyptian novelist Naguib Mahfouz as the focus personality.

The Arabian Travel Market is taking place from 6-9 May at DWTC Dubai under the theme Transforming Travel Through Entrepreneurship. The event will focus on issues relating to entrepreneurial strategies.

The Abu Dhabi International Book Fair (ADIBF 2024) is set to take place from 29 April to 5 May at the Abu Dhabi National Exhibition Centre under the Department of Culture and Tourism. The fair will host 1,350 publishers from 90 countries and 375 local exhibitors presenting over 2k activities.

TheAnnual Investment Meeting (AIM) Congress is scheduled to be held on 7-9 May at the Abu Dhabi National Exhibition Centre. Gathering senior government officials and industry experts, the summit will focus on exploring means of strengthening the economy under the theme Resilient, Sustainable Economic Growth – Creating a Healthy and Prospective Investment through FDI and FPI.

The Middle East Petroleum and Gas Conference is set to take place from 20-22 May in Dubai, hosted by the Emirates National Oil Company and under the organization of S&P Global Commodity Insights. The theme of the conference is “Evolving Core Energy Markets within a Sustainable Landscape.”

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

Total foreign trade reached a record AED 4.45 tn in 2023

The UAE’s combined foreign trade in goods and services reached a record AED 4.45 tn in 2023, Vice President Sheikh Mohammed bin Rashid Al Maktoum said in an X post following the UAE’s Cabinet meeting in Abu Dhabi.

Total service exports in the UAE reached AED 606 bn in 2023, compared to the AED 570 bn recorded in 2022. More than AED 170 bn of total service exports in 2023 were generated from digital service exports, according to Al Maktoum.

Remember: Non-oil trade hit a record AED 3.5 tn in 2023, Al Maktoum said back in February. Trade in goods was up 12.6% y-o-y to AED 2.6 tn, while trade in services hit AED 900 bn. Exports of goods and services surpassed AED 1 tn for the first time. The UAE’s merchandise exports during the year came in at about USD 488 bn (AED 1.792 tn), according to a recent World Trade Organization report.

The UAE was ranked 15th globally for outward foreign direct investment (FDI) in 2023, the vice president said in a separate X post, citing United Nations Conference on Trade and Development data. Outward FDI flows surpassed AED 880 bn at the start of the year, according to the post.

In context #1: The UAE pledged some USD 44.5 bn in outward foreign direct investments, Bloomberg reported previously, citing data from fDi Markets. In 2022, it pledged USD 52.8 bn in FDI investments in 2022, which exceeded Beijing’s contributions 20x and those of the US 7x,.

In context #2: TotalEmirati investments overseas reached an estimated USD 2.5 tn at the beginning of 2024, UAE International Investors Council Secretary-General Jamal bin Saif Al Jarwan said recently, according to Wam. One of the UAE’s “landmark” investments overseas is ADQ’s USD 35 bn investment to develop Egypt’s Ras Al Hekma, which is expected to drive the UAE’s total investments in Egypt to around USD 65 bn, according to Al Jarwan.

Bayanat-Yahsat merger gets shareholder approval

Bayanat and Yahsat shareholders signed off yesterday on a proposed merger between the two companies, according to an ADX disclosure (pdf). The merger will create a new entity, Space42, which is set to become the first AI-powered space tech company in the MENA region. The two companies had first announced their plans to merge back in December.

Refresher: The merger — which is expected to be valued at AED 15 bn (c.USD 4 bn) — will be executed via a share swap, with Bayanat holding 54% of Space42 and Yahsat holding the remaining balance.

What’s next? The transaction is now pending regulatory approval before it’s executed. The companies had previously said they expect the merger to come into effect in 2H 2024. Post-merger, Yahsat will delist from the ADX.

Advisors: Houlihan Lokey counseled Bayanat with FTI Capital Advisors offering advisory support to Yahsat.

Emirati-Omani consortium snags USD 1.35 bn contract for UAE-Oman rail link

USD 1.35 bn contract for UAE-Oman railway awarded: Oman’s Galfar Engineering and Contracting's joint venture — including Trojan Construction Group — snapped up a USD 1.35 bn design and build contract for the UAE-Oman railway link, according to a press release. The construction timeline was not disclosed. The consortium also includes National Infrastructure Construction Company (NICC) and Tristar Engineering & Construction, Meed reports.

ICYMI- The UAE and Oman inked USD 35 bn partnerships earlier this week, including AED 11 bn in allocations towards the rail link to kick off its construction. A contract was also awarded to Siemens Mobility and Egypt’s Hassan Allam Construction to build, design and integrate signaling, telecom, and power supply systems for the railway link.

Background: Etihad Rail had inked an agreement with Omani national railway developer, Oman Rail, in 2022 to set up the Oman-Etihad Rail Company, a USD 3 bn (c. AED 11 bn) 50-50 JV, for the design, development, and operation of Hafeet Railway. The transport link is 303 km long and connects Oman’s Sohar Port to Abu Dhabi, in a bid to bolster trade between the countries. The rail line will serve both passenger and freight trains.

Mashreq, Emirates NBD, ADCB, and United Arab Bank post solid 1Q earnings

It’s another day of bank-heavy earnings: Our friends at Mashreq, Emirates NBD, Abu Dhabi Commercial Bank, and United Arab Bank all reported their 1Q 2024 results yesterday.

MASHREQ-

Our friends at Mashreq reported AED 2.0 bn in net income after tax in 1Q 2024, rising 25% y-o-y, according to an earnings report (pdf). On a pre-tax basis, net income came in at AED 2.3 bn (up 36% y-o-y), with the lender noting that its net income after tax remained strong despite the introduction of the 9% corporate tax.

Driving the growth: “The main drivers include exceptional business growth, healthy client margins, the current interest rate environment, and low risk costs,” Mashreq said. The bank also reported 23% y-o-y growth in its net interest income, rising to AED 2.1 bn, which accounted for 68% of the lender’s total revenues for the quarter. Non-interest income rose 29% y-o-y, coming in at nearly AED 997 mn.

What they said: “Mashreq has demonstrated remarkable strength and adaptability amid global challenges, maintaining solid asset growth, financing, and capital adequacy ratios,” said Mashreq Chairman Abdul Aziz Al Ghurair.

Looking ahead: “Our efforts to launch our Digital Retail Bank in Pakistan remain afoot, which will mark a significant step in our international expansion,” said Group CEO Ahmed Abdelaal. “Additionally, the initiation of corporate banking operations in the United Kingdom and the opening of a new branch in Mumbai are pivotal in our mission to deliver innovative banking solutions across diverse markets. In Egypt, the launch of Mashreq NEO represents a key development in offering simplified and innovative banking experiences, which align with our goals to enhance customer satisfaction,” Abdelaal said.

EMIRATES NBD-

Emirates NBD reported a bottom line after tax of AED 6.7 bn in 1Q 2024, up 12% y-o-y and 67% from the previous quarter,according to the bank’s earnings release (pdf). The company attributes the net income growth to “regional growth, increased transaction volumes, a low-cost funding base, and substantial impaired loan recoveries.”

Emirates NBD’s Shariah-compliant banking arm, Emirates Islamic, posted a record bottom line of AED 811 mn during the quarter.

Operating income rose 3% y-o-y to AED 10.7 bn during the quarter, on the back of loan and fee and commission growth, the bank said. Meanwhile, total assets crossed the AED 900 mn mark for the first time.

Looking ahead:The bank sees the UAE’s non-oil sector continuing to grow this year, and notes that it has yet to see impacts from geopolitical developments in the region on its operational environment, but remains “mindful of the potential risks.”

ADCB-

Abu Dhabi Commercial Bank (ADCB)’s net income after tax rose 14% y-o-y to AED 2.14 bn in 1Q 2024, according to the bank’s earnings release (pdf). Growth was driven by “solid loan growth” in the lender’s corporate and investment banking and retail banking businesses, with net loans from corporate and investment banking growing 28% y-o-y.

Net interest income increased 16% y-o-y to AED 3.3 bn, while non-interest income jumped 21% y-o-y to AED 1.29 bn. ADCB’s operating income stood at AED 4.59 bn in 1Q 2024, up 17% y-o-y. Total assets during the quarter totaled AED 594 bn, representing an increase of 19% y-o-y, with interest earnings assets making up AED 492 bn.

UNITED ARAB BANK-

United Arab Bank’s net income after tax rose 25% y-o-y to AED 68 mn in 1Q 2024, according to its earnings release (pdf). Meanwhile, total income increased 33% y-o-y to AED 163 mn during the quarter. The growth in net income came on the back of a “significant increase” in the banks’ assets, hitting AED 17.9 bn, as well as a prudent risk management approach, the bank said.

Looking ahead: “We will pursue our ambitious vision relentlessly and accelerate the pace of investments in our growth strategy with a focus on developing innovative products and services that meet all customer aspirations whilst upholding the highest standards of compliance and internal controls,” Chairman Sheikh Mohammed bin Faisal bin Sultan Al Qassimi said.

Shorages closes USD 1 mn pre-series A funding from Saudi-based Joa Capital

Dubai-basedlogistics startup Shorages has secured USD 1 mn in a pre-series A funding round following the company’s expansion to Saudi Arabia in November, according to a {press release}. The seed round was led by Riyadh-based investment manager Joa Capital through their S3 Ventures Fund.

The seed round will help Shorages expand its warehouses across the GCC, while also facilitating the expansion of more brands within Saudi Arabia, thus serving to build a “bridge between the UAE and KSA,” according to the statement.

More on Shorages: Established in 2019 by Rayan Osseiran (LinkedIn), Shorages offers a network of fulfillment centers that can receive inventory and dispatch orders locally and internationally for contracted merchants. The company also has a management and order fulfillment system, allowing merchants to monitor their stock levels, order statuses, and sales performance, and offers product registration services.

Dnata appoints new airport operations senior VP + Shakeup at Shuaa

Dubai-based air services provider Dnata has appointed Clive Sauvé-Hopkins (LinkedIn) as senior vice president of its airport operations division, according to a statement. Hopkins will oversee dnata’s ground handling and cargo operations at 97 airports in 16 countries. Hopkins has held several senior leadership positions with Swissport, Servisair, Aviapartner, Qatar Airways, and the Abu Dhabi Developmental Holding Company, according to the press release.

Shuaa Capital Chairman Fadhel Al Ali has stepped down after five years in the position, according to a DFM disclosure (pdf). Three independent board members were also re-elected: Badr Al Olama (LinkedIn), Ahmed Al Ahmadi (LinkedIn), and Hamda AlMheiri.

REMEMBER: Shuaa Capital reached an agreement with its bondholders to restructure some USD 150 mn in outstanding bonds owed by a special purpose vehicle it owns. The restructuring agreement came as the investment bank is pushing through a wider restructuring that it says is a checkpoint on the road to a “capital injection that will restore business stability and continuity,” after its net losses deepened fivefold over the past year. Shuaa had also said following the debt restructuring agreement it is “putting in place a new management team and is working to complete its capital optimization plan imminently.”

Dubai Crown Prince Sheikh Hamdan bin Mohamed Al Maktoum has tapped Muna Al Marzooqi (LinkedIn) as Dubai Health Authority’s CEO of corporate shared support services, according to Al Bayan. Al Marzooqi was previously head of the Federal Tax Authority’s institutional excellence division.

Amlak Finance tapped Jamal Hamed Almarri as chairman, while Shaker Fareed Zainal (LinkedIn) was named vice chairman, a DFM disclosure (pdf) reads.

How G42 fits into the US-China tech race

Leading the conversation on the UAE in the foreign press: Reports that climate change was a major culprit behind last week’s historic storms. Analysis from the World Weather Attribution research initiative indicated that climate change made the storm up to 40% more intense. Researchers have also suggested that the flooding, “which came from two separate and near simultaneous storm systems, would not have happened without El Nino.” (You can read more about El Nino on Enterprise Climate, here.) The {Associated Press} and {Bloomberg} took note of the story.

ALSO- Bloomberg saysMicrosoft’s investment in G42 makes it a key player in the US-China tech race.

Another step closer to flying taxis

TRANSPORT-

First UAE vertiport gets green light: The General Civil Aviation Authority (GCAA) granted operational approval for the country’s inaugural vertiport, reports Wam. The vertiport debuted on the sidelines of the DRIFTx event in Abu Dhabi.

Fast facts: The GCAA published the world’s first national regulation related to vertiports — covering their design and operational requirements — back in December 2022. The authority has since announced a plan to launch air taxis by 1Q 2026.

ALSO- Archer is moving forward with its air taxi plans: California-based electric flying car manufacturer Archer Aviation also signed a framework agreement with the Abu Dhabi Investment Office (ADIO) to construct vertiports in Abu Dhabi, according to an Abu Dhabi Media Office statement. The framework agreement also includes “operational enablement” for air taxis in the country, as well as locally manufacturing Archer’s Midnight aircraft. Abu Dhabi-headquartered aviation services provider Falcon Aviation had earlier inked an agreement with Archer to develop a vertiport network in key locations across Dubai and Abu Dhabi by 2025.

…as is Joby Aviation, which inked an MoU with Abu Dhabi’s department of municipalities and transport to lay the groundwork for it to introduce inter-emirate electric air tax services as early as 2025, Wam reports. The air taxi manufacturer already holds a license to operate in Dubai for six years.

REAL ESTATE-

Samana launches new Dubai project: Dubai-based real estate firm Samana Developers inaugurated its AED 272.2 mn development in Dubai Production City, the Samana Lake Views Project, according to a press release. The development comprises two towers, offering some 1k apartments across 794k sqft. It is slated for handover in October 2027, with prices starting from USD 178k.

Background: Samana said in March it plans to build residential projects in the emirate at a cost of AED 12.5 bn over 2024. The company will award 18 construction contracts to construction firms to build the residential projects, most of which are waterfront developments. It expects to rake in some AED 8.8 bn in sales in 2024 after recording AED 3.3 bn in sales last year.

TECH-

The central bank (CBUAE) has partnered with American IT company Accenture to ramp up its Supervisory Technology (SupTech) initiative and Enterprise Data Management (EDM) program, focusing on licencing, supervising, and enforcing digital solutions over the next two years, it said in a statement. SupTech seeks to automate and streamline supervisory activities for banks and licensed financial institutions, while EDM provides advanced analytics, automation, and AI-driven decision-making via a single portal.

HEALTHCARE-

Abu Dhabi backs disease prevention: Reaching the Last Mile, a global health portfolio backed by President Sheikh Mohamed bin Zayed Al Nahyan, has invested AED 55 mn in the Global Institute for Disease Elimination, which was established in 2019 by the president to accelerate the elimination of preventable infectious diseases, according to the Abu Dhabi Media Office. This marks the portfolio’s second investment in the institute.

EDUCATION-

#1-Sharjah gets a new university: Sharjah Ruler Sheikh Sultan bin Mohammed Al Qasimi issued a decree establishing a new nonprofit scientific university, the University of Dhaid, with registration and admission set to begin in the 2024-25 academic year, Wam reports. The university will specialize in agriculture, environment, food, and livestock, with several facilities, centers, and projects set to be constructed. Sheikh Sultan — who will be the new university’s president — also issued a decree forming the university’s board of trustees, in addition to appointing Aisha Ahmad Abu Shlaibi as the University of Dhaid’s chancellor.

#2-The King Sejong Institute — a foundation aiming to spread knowledge of the Korean language — has inaugurated its MENA HQ in Sharjah, Gulf News reports. The South Korean government-run institute’s initial courses will begin before July, and will be taught at Sharjah University.

Banks post strong 1Q 2024 results

It’s peak earnings season in the West, and yesterday saw several major banks report their financial results for 1Q 2024.

#1- Investment banking became Deutsche Bank’s “breadwinner” in 1Q 2024: Deutsche Bank's fixed-income trading and transaction executions experienced a resurgence in 1Q 2024, leading to revenue growth in its investment banking division and contributing to a 10% y-o-y increase in net income, according to its earnings release.

The lender's retail division, once the top earner benefiting from high interest rates, lost its position due to customer service glitches. The bank’s net income attributable to shareholders stood at EUR 1.275 bn for the quarter, surpassing analyst expectations and increasing 10% y-o-y.

Shares in the bank were up 8% at market close.

#2- Barclays is back in the black: Barclays reported earnings attributable to shareholders of GBP 1.55 bn for 1Q 2024, surpassing analyst expectations and rebounding from a net loss of GBP 111 mn in 4Q 2023, according to its earnings release (pdf). The British lender bounced back after implementing its overhaul plans, which included further investment in UK consumer businesses and the acquisition of Tesco Bank, according to Barclays CEO, C.S. Venkatakrishnan. The bank’s shares closed up 6.7%.

ALSO WORTH KNOWING-

The JPY hit a fresh 34-year low against the greenback, slipping past the 155 mark as the USD continues to strengthen — raising speculation that the Japanese government will intervene to stabilize FX markets. (CNBC)
Quantitative hedge funds see high returns: Computer-driven hedge funds are reaping high returns from trends in financial markets, with hedges on rising cocoa prices and a weakening JPY seeing a 12% gain in 1Q 2024, as per a Société Générale index. (Financial Times)

THE MARKETS THIS MORNING-

Asian markets are mostly in the green this morning ahead of a key Bank of Japan monetary policy meeting that follows a historic low for the JPY. Meanwhile, US futures point to a strong opening after a strong earning showing from Big Tech.

ADX	9,041	0.0% (YTD: -5.6%)
DFM	4,169	+0.1% (YTD: +2.7%)
Nasdaq Dubai UAE20	3,547	-0.2% (YTD: -7.7%)
USD : AED CBUAE	Buy 3.67	Sell 3.67
EIBOR	5.0% o/n	5.4% 1 yr
TASI	12,254	-0.8% (YTD: 2.4%)
EGX30	25,917	-3.2% (YTD: +4.1%)
S&P 500	5,048	-0.5% (YTD: +5.8%)
FTSE 100	8,078	+0.5% (YTD: +4.6%)
Euro Stoxx 50	4,939	-1.0% (YTD: +9.2%)
Brent crude	USD 89.28	+0.3%
Natural gas (Nymex)	USD 1.56	-4.8%
Gold	USD 2,342.20	0%
BTC	USD 64,433.95	+0.1% (YTD: 45.8%)

THE CLOSING BELL-

The DFM rose 0.1% yesterday on turnover of AED 592.1 mn. The index is up 2.7% YTD.

In the green: National General Ins. Company (+10.1%), GFH Financial Group (+5.8%) and Commercial Bank of Dubai (+4.2%).

In the red: Agility (-10.0%), Watania International Holding (-5.4%) and Deyaar Development (-4.8%).

Over on the ADX, the index stayed flat on turnover of AED 992.2 mn. Meanwhile Nasdaq Dubai fell 0.2%.

UAE wraps trade agreement talks with Chile

UAE + Chile wrap trade talks: Foreign Trade Minister Thani bin Ahmed Al Zeyoudi and Chile’s Foreign Minister Alberto van Klaveren concluded negotiations yesterday on a trade and economic agreement between the two countries, Wam reports. The agreement will support growth in open and rules-based trade and investment, and open up access for UAE companies and exporters to Chile and the rest of Latin America.

Fast facts: Non-oil trade between the UAE and Chile reached USD 305.1 mn in 2023, up 23.6% since 2019.

UAE ❤️ trade with Latin America: Al Zeyoudi inked a similar agreement in January with Costa Rica to streamline trade and customs procedures. The minister also signed an agreement with Colombia last week.

SPEAKING OF LATIN AMERICA- UAE President Sheikh Mohammed bin Zayed Al Nahyan discussed further economic and trade cooperation with his Costa Rican counterpart, Rodrigo Chaves Robles, during a phone call yesterday, Wam reports. The two leaders discussed potential cooperation in renewables, sustainability, and environmental conservation, as well as greentech and agricultural innovation.

OTHER DIPLOMACY NEWS-

Foreign Affairs Minister Abdullah bin Zayed Al Nahyan met with the UN’s deputy secretary general, Amina Mohammed, to discuss cooperation on humanitarian and development issues, as well as ongoing tensions in the Middle East and the situation in Gaza, Wam reported.

My Morning Routine: Kareem Elsirafy, managing partner at Modus Capital

Kareem Elsirafy, managing partner and founder of Modus Capital: Each week, My Morning Routine looks at how a successful member of the community starts their day — and then throws in a couple of random business questions just for fun. Speaking to us this week is Kareem Elsirafy (LinkedIn), managing partner and founder of Modus Capital. Edited excerpts from our conversation:

I’m Kareem, an Egyptian American entrepreneur turned investor. I’m the managing partner and founder of Modus Capital, which is a venture platform. We invest in early stage tech companies the traditional way, but also through venture building. We essentially cobuild and cofound companies with smart and skilled entrepreneurs and subject matter experts.

My last startup was a SaaS company in New York in the health and human services industry. It started from an idea on a pitch deck raising USD 2. 2 mn in seed funding, to now being worth USD 2 bn. That journey is very exhausting. This was from 2011 to 2015, and by 2015, I got founder burnout, so I transitioned out and exited. I took a little bit of time off to see what I wanted to do, and started consulting companies in New York and in LA with a team of operators.

We were helping companies break through stagnated growth, preparing and supporting them on raising funds and their next round. Our investor network saw that we were this value creation team that was helping companies, and asked if they could invest in these companies, so we started this ad hoc investment and operationally supporting company model. We started bringing our network transactions every month, and they suggested we set up a fund. While we thought about doing that in 2017, two of the companies we were working with got acquired by quasi-governmental organizations here in the UAE. That made me look at the region.

I landed in Cairo — because I’m Egyptian, of course — and I spent all of 2018 and 2019 learning about the ecosystem in the MENA region. What I identified was there's lots of economic opportunity, and opportunity to build valuable tech companies, and there's a lot of great talent, but not a lot of people who have gone from idea to exit. So if you're a first time entrepreneur, which most of the people in the Middle East are, where can you find skilled, experienced talent that's been there and done that? That’s where we come in, and this is how the venture building model came up.

We started with a pilot in Egypt and then came to the UAE during covid and set up in Abu Dhabi and partnered with Hub71. Now, we're in Egypt, Saudi Arabia, and Abu Dhabi.

I have three main areas of focus: fundraising, strategic operations and planning, and portfolio management, which involves providing the entrepreneurs I work with strategic brainpower and decision making where support is needed.

I think the focus now in the region is on building companies whose value is substantiated. Companies were raising money with valuations based on how much they're raising, and I see that this is an issue from the VC industry, where companies were pumping up the markup on their portfolio, so they can raise a second fund and a third fund. That model doesn’t work here. We’re not in Europe or the US, where you have the most mature public markets where companies can IPO.

I think that investors are going to look at proper metrics and KPIs and invest into a business based on its business merits. I think it is also the best time for investors to find companies. Anybody who's made tons of money always made it by investing in a down cycle, and then riding the wave up — so people who are being super conservative with their funds right now, I think are making a mistake. Now is the time to put money in.

I don’t think the [investment lull] is over. I think we are teetering between the tail end of it and the beginning of the upswing, but I think we'll have definitive clarity in the next 18 months.

I usually wake up around 4 or 4:30am. We have an international team and part of our executive team and my partners are in the US, so it allows me to catch them at the end of their day and I get to catch up with them. I wake up, read the Quran for a few minutes, and then do some reading. I don’t look at my phone for the first hour I'm awake. After that, I'll go to the gym, where I usually will be talking on the phone with people in the US.

Once I’m back from the gym, that's when I start looking at my computer. From 6-7am to 9-10am, this is where I get most of my work done. People in the US are sleeping, and people in Egypt and the UAE are still sleeping, so this is the time I own. After 10am, the company owns my time. That has me talking to my executive team, putting out fires, getting on calls.

It's important for everybody, especially people who are in leadership positions, to do a cost benefit analysis, and weigh the cost of their time, money, energy, mental capacity, etc, against the benefit for this task. If you do a cost benefit analysis for every task that you have, the ones that have a very big cost and very low benefit clearly go to the bottom of the list. The ones that have very low cost and very high benefits are the ones you probably want to do first because you can bang them out and get them done.

One thing that never changes is that being at the top of an organization is very lonely. You're the good guy when it's convenient — which is seldom — and you're always the bad guy [laughs], because the ball stops with you. There's a lot of crisis management, and every day there’s a punch in the face. But every day, I have to punch back. Some days, it's easy. Some days it’s extremely challenging, because as the company grows, the problems just get bigger and everything is on a bigger scale.

During the week, I always make sure to spend at least the last two hours in the evening — or at least 30-45 minutes in the morning — with my family. But it can be in extremes — Modus is technically a startup, and I’m an entrepreneur, so this isn't a corporate job where I can go play golf three days a week. So sometimes I go super hard all week, and totally disconnect on the weekend, or go super hard two or three months and then take two or three weeks where I switch off. Work life balance depends on the status of the business, so the more the business grows and matures and gets more stability, the more I can control that balance.

When I do switch off after my workday, I usually just hang out with my wife and my daughter in front of the TV. Most of the time, it’s either Ms. Rachel or Blippi playing on TV.

I really enjoy Conversations with Loulou. I was on one and I got hooked after. Those are great to hear the perspectives and stories of other people in the ecosystem. I’m also a big World War II documentary nerd, and I read a lot of Andreessen Horowitz (aka a16z’s) blog and Jack Abraham, the founder of Atomic, which is a venture builder. My two hobbies are snowboarding and racing motorcycles.

The best piece of advice I've been given is don't trade what you want right now for what you ultimately want in the future. It was given to me by my high school football coach. He always told me not to chase the short term, and to always be forward thinking.

CALENDAR

APRIL

26 March-21 July (Tuesday-Sunday): ‘From Kalila wa Dimna to La Fontaine: Traveling through Fables’ exhibition, Louvre Abu Dhabi.

21 April-7 May (Sunday- Tuesday): The ICC Women's T20 World Cup Global Qualifier 2024.

23-29 April (Tuesday-Monday): Subscription period for retail investors for Spinneys’ IPO.

23-30 April (Tuesday-Tuesday): Subscription period for institutional investors for Spinneys’ IPO.

24-26 April (Wednesday-Friday): Global Education & Training Exhibition, Dubai World Trade Centre.

24 April-1 May (Wednesday-Wednesday): Abu Dhabi Mobility Week.

25-26 April (Thursday-Friday): DRIFTx, Abu Dhabi.

27-28 April (Saturday-Sunday): Frontiers in Advanced Hepato-Biliary Cancers and Transplant Oncology, Cleveland Clinic Abu Dhabi.

28-29 April (Sunday-Monday): World Economic Forum’s Special Meeting on Global Collaboration, Growth and Energy for Development, Riyadh, Saudi Arabia.

28 April (Sunday): International Congress of Arabic Publishing and Creative Industries, Manarat Al Saadiyat in Abu Dhabi.

29-30 April (Monday- Tuesday): Dubai World Ins. Congress, Atlantis, The Palm.

29 April- 5 May (Friday-Friday): The Abu Dhabi International Book Fair, Abu Dhabi National Exhibition Centre (ADNEC).

MAY

1-2 May (Wednesday-Thursday): Capital Markets Summit, Madinat Jumeirah, Dubai

1-5 May (Wednesday-Sunday): The Sharjah Animation Conference, Expo Centre Sharjah.

6-7 May (Monday-Tuesday): Dubai Fintech Summit 2024, Madinat Jumeirah.

6-9 May (Monday-Thursday): The Arabian Travel Market, Dubai World Trade Centre, Dubai.

7-9 May (Tuesday-Thursday): AIM Congress 2024, Abu Dhabi.

8-9 May (Wednesday-Thursday): Innovative Finance Expo, Jumeirah Emirates Towers.

8-12 May (Wednesday-Sunday): Schmetterling Annual Conference, Al Ain and Abu Dhabi.

9 May (Thursday): Spinneys shares begin trading.

14-15 May (Tuesday-Wednesday): Seamless Middle East, Dubai World Trade Centre.

14-16 May (Tuesday-Thursday): The Airport Show, Dubai World Trade Centre.

15 May (Wednesday): HFM Summit, DIFC.

15 May (Wednesday): UAE and Indian officials are set to meet for the first time on the India-Middle East-Europe Economic Corridor.

18-26 May (Saturday-Sunday): Abu Dhabi Comedy Week, Abu Dhabi.

19 May (Sunday): InvestopiaEurope, Milan.

19 May (Sunday): RTA’s Deadline for bids to design and build Dubai Metro's Blue Line.

20-22 May (Monday-Wednesday): Middle East Petroleum & Gas Conference, Dubai.

21-23 May (Tuesday-Thursday):International Exhibition for National Security & Resilience, ADNEC Centre Abu Dhabi.

24-25 May (Friday-Saturday): Baby Expo, Dubai World Trade Centre.

27-29 May (Monday-Wednesday): Arab Media Forum, Dubai.

30 May (Thursday):Abu Dhabi Family Office Summit, Saadiyat Rotana Resort, Abu Dhabi.

JUNE

2-4 June (Sunday-Tuesday): The World Air Transport Summit and International Air Transport Association (IATA)’s annual general meeting, Dubai.

4-6 June (Tuesday-Thursday): The Hotel Show, Dubai World Trade Centre.

4-6 June (Tuesday-Thursday): INDEX, Dubai World Trade Centre.

4-6 June (Tuesday-Thursday): WORKSPACE, Dubai World Trade Centre.

4-6 June (Tuesday-Thursday): Leisure Show, Dubai World Trade Centre.

15 June (Saturday): Arafat day, national holiday.

16-18 June (Sunday-Tuesday): Eid Al-Adha, national holiday.

Signposted to happen sometime in 1H 2024:

Spinneys inaugurates its first store in KSA

JULY

7 July (Sunday): Islamic new year, national holiday.

SEPTEMBER

9-11 September (Monday-Wednesday): World Utilities Congress, Abu Dhabi.

28-30 September (Saturday-Monday): World Association of Nuclear Operators (WANO) Biennial General Meeting, Abu Dhabi.

OCTOBER

30-1 November (Wednesday-Friday): World Cities Cultural Summit, Dubai.

NOVEMBER

11-14 November (Monday-Thursday): ADIPEC, Abu Dhabi.

11-14 November (Monday-Thursday): ADIPEC Maritime and Logistics Exhibition and Conference, Abu Dhabi.

11-14 November (Monday-Thursday): ADIPEC Decarbonisation Accelerator, Abu Dhabi.

27-28 November (Wednesday-Thursday): RAK Energy Summit, Al Hamra International Exhibition and Conference Centre, Ras Al Khaimah.

DECEMBER

2-3 December (Monday-Tuesday): National Day, public holiday.

5-8 December (Thursday-Sunday): Formula 1 Etihad Airways Abu Dhabi Grand Prix, Yas Marina Circuit.

9-10 December (Saturday-Sunday): The Bitcoin Mena Conference, Adnec Centre Abu Dhabi.

10-12 December (Tuesday-Thursday): Middle East Business Aviation, Dubai World Central.

Signposted to happen sometime before the end of the year:

Spinneys inaugurates three more stores in KSA

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