KUWAIT: On the sidelines of the general assembly of Gulf Cables & Electrical Industries Group Co KSCP, which approved the distribution of 65 fils in cash for each share, Vice Chairman Bader Al-Kharafi expressed his surprise at the continuation of the government’s approach regarding equating national products with GCC products and the failure to give Kuwaiti products preference over their GCC counterparts in government tenders.

“It is not fair for Kuwaiti companies and their products to be equated to markets that do not grant them the same advantages, as the Kuwaiti government is currently pursuing in accordance with the circular issued in this regard,” Al-Kharafi said.

“Is it reasonable for a company that employs 700 Kuwaiti employees, perhaps even a thousand or more, and supports employment, pays the percentage to the Kuwait Foundation for the Advancement of Sciences, is keen to deduct zakat annually, and pays electricity and water fees and other requirements, to be competed with by a representative administrative office of a Gulf company that contains four employees who follow the procedures of competition and apply for contracts and tenders, without virtue or discernment for the Kuwaiti company in the competition for tenders offered by state institutions?” Al-Kharafi asked.

“We support any positive government trends that ensure that Kuwaiti companies are treated similarly in the Gulf as well and in a way that guarantees fair procedures,” he said. Al-Kharafi added that if GCC countries give Kuwaiti companies the opportunity to enter their markets with the same facilities, justice imposes the same, but if the activity of the national company is limited to the local market and even surprised by unfair competition from other Gulf countries, the whole matter needs to be reconsidered, otherwise such a trend will be detrimental to the national product and national employment.”

Al-Kharafi said in a press statement after the general assembly: “Such a trend is no longer acceptable, and proceeding with it will have a significant impact on all locally manufactured companies, but will cast a negative shadow on small enterprise companies, entrepreneurs and consumer products.”

“The local product should not be equal to the Gulf unless we are treated similarly according to a clear agreement with features and details, as what we have monitored in those countries is completely contrary to that, as the concerned authorities in each Gulf market are interested in providing their product over any other product through facilities and explicit discrimination,” Al-Kharafi said.

General assembly

The ordinary general assembly of Gulf Cables & Electrical Industries Group approved the cash dividends recommended by the board of directors to shareholders at the rate of 65 cash fils per share in accordance with the eligibility controls followed by Boursa Kuwait.

Special profits

This comes in light of the group’s outstanding operating results and profits in 2023, compared to a cash dividend of 60 fils per share for 2022. Al-Kharafi said that the sustainability of the growing profitability recorded by the group is the result of a strategic plan implemented on the ground, pointing out that the group continues to expand and achieve its strategic goals despite the economic and geopolitical fluctuations on the regional scene currently.

Achieving goals

Al-Kharafi added: “The annual financial results of Gulf Cables have shown our success in achieving the financial objectives and improving the performance at the level of revenues and profitability of the group, as it witnessed a significant improvement in the key financial performance indicators.” Al-Kharafi stressed that this achievement reflects and confirms once again the strength, capability and resilience of Gulf Cables in all aspects of its business in accordance with our firm commitment to increasing financial returns and enhancing value for its shareholders.

Revenue growth

In the context of his remarks after the meeting, he pointed out that the total revenues of Gulf Cables grew by 8 percent annually to reach KD 122.1 million compared to KD 113 million. Al-Kharafi explained that the stability of the group’s conditions was crystallized by the profits it achieved, accompanied by a record growth during 2023 amounting to 62.5 percent to reach KD 21 million compared to KD 13 million for 2022. The company’s profit growth was reflected in the total equity of the owners of the parent company to reach KD 230.3 million compared to KD 227.8 million at the end of 2022.

Digital transformation

“Based on the group’s belief that there is an opportunity to help achieve long-term economic diversification and industrial development, help deliver energy sources to new cities and regions, and achieve sustainability by providing products and adopting environmentally friendly practices, Gulf Cables is interested in new global digital transformation technologies to gain more flexibility and competitiveness and enhance efficiency across the group’s companies and sectors,” said Al-Kharafi.

Investment opportunities

Al-Kharafi pointed out that Gulf Cables always seeks to identify investment opportunities with high added value that are in line with its general strategy based on several objectives and determinants so that they are more aligned and compatible with the group’s vision, as well as there is a comprehensive follow-up of the performance and value of the group’s existing investments to ensure the best rate of return and growth, as well as exiting whenever the opportunities are favorable.

Premier market

At the level of Boursa Kuwait, Al-Kharafi stressed the Group is keen to be among the premier market companies in Boursa Kuwait, which is the elite market for the best listed companies that are characterized by high liquidity and medium to large market capitalization, which enhances the position of the financial group and its stability and its ability to provide a high degree of transparency to its shareholders and stakeholders. It is noteworthy that the general assembly approved all the items included in the agenda, including the reports of the board of directors and the auditors.

Reduced loans

The Group’s total value of Islamic loans and financing showed a significant decrease for the second consecutive year by KD 12.7 million (decrease by KD 28.2 million in 2022) and a decrease of 29.1 percent to reach KD 31.2 million by the end of 2023 compared to KD 43.9 million at the end of 2022.

End of restrictions

The restrictions on dealing with Gulf Cables and Electrical Industries Company’s ownership in Boursa Kuwait, which represents 14.41 percent of the shares, have expired as of March 13. The discount applied to the declared purchase price will be canceled when determining the fair value of the investment in that share, as the group recorded a 15 percent discount on the total market value of KD 49.75 million for those shares as of December 31, 2023 of KD 7.46 million to reach KD 42.28 million. The group explained that the impact of canceling the discount rate by increasing the value of investments at fair value will be reflected in other comprehensive revenues within non-current assets, and increasing the value of accumulated changes in fair value within the total equity of the owners of the parent company by KD 7.46 million, as of the first quarter of this year.

The perfect balance

Al-Kharafi stated that the Group continues to achieve impressive revenues from the investment sector by recording meaningful cash dividends. “This distinction is due to the focus of our investment policy on key factors, led by achieving an ideal balance between profitable financial returns for our shareholders and ensuring sustainability and future growth, by identifying low- and medium-risk stock options in different activities and industries with moderate and diversified geographical distribution,” he said.

Acknowledgements

At the end of the meeting, Al-Kharafi thanked all shareholders for their trust and continuous support for the group’s march. He expressed his deep gratitude and appreciation to the executive team and all the group’s employees for their sincere efforts, loyalty and continued commitment to the group’s objectives and in enhancing its capabilities to move forward with confident steps on the right track to achieve the desired growth and sustainability.