Derayah Financial (4984) Q1 2025 earnings summary

Executive summary

• Q1 2025 delivered resilient results with strong core revenues, robust profitability, and continued growth in client accounts, AUM, and AUC, despite market volatility and a 16% decline in trading value year-on-year.

• Operating income reached SAR 209 million, down 6% year-on-year, while net profit was SAR 106 million, with a net profit margin of 51%.

• Customer accounts grew 4% quarter-on-quarter to 555,000; AUM rose 5% YTD to SAR 18.1 billion; AUC increased 20% YTD to SAR 36.4 billion.

• Advanced digital transformation with new product launches, including the SBL program, robo-advisory (Derayah Smart), and new funds.

• Maintained strong capital adequacy and approved a new dividend policy.

Financial highlights

• Operating income: SAR 209 million, down 6% year-on-year; net profit: SAR 106 million, down 22% year-on-year.

• Brokerage revenue up 6% year-on-year to SAR 134 million; non-margin trading revenue up 3% year-on-year.

• Margin lending revenue surged 64% year-on-year due to lower funding costs.

• Asset management revenue declined 22% year-on-year to SAR 33 million, mainly due to lower performance and subscription fees.

• Cost-to-income ratio at 37%; capital adequacy over 26%; total equity increased 24% year-on-year to SAR 1,084 million.

Outlook and guidance

• Management expects to maintain a dividend payout ratio above 60% and a minimum annual dividend of SAR 1.3 per share for 2025, with quarterly distributions through 2027.

• Medium-term guidance targets 7-8% revenue growth in brokerage and special commission income, 22-24% in asset management, and group operating income growth of ~10%.

• SBL program and new product launches expected to drive revenue growth in H2 2025.

• Integration with D360 Bank to create cross-selling opportunities and enhance the ecosystem.