Derayah Financial (4984) Q1 2026 earnings summary

Executive summary

• Achieved 9% year-on-year growth in total operating income to SAR 228 million for Q1 2026, driven by strong special commission income and resilient trading activity, especially in international markets.

• Core net profit (excluding D360 Bank/associates) reached SAR 127 million, up 3% YoY in one source but down 3% YoY in another, while D360 Bank losses narrowed as the bank scaled.

• Recurring revenue share increased to 43.3% of operating income, up from 37.2% a year ago, reflecting a shift to more stable revenue streams.

• Assets under custody rose 5% YTD to over SAR 35 billion, with client accounts exceeding 600,000.

• Continued investment in technology, product innovation, and expansion of both retail and institutional offerings.

Financial highlights

• Operating income for Q1 2026 was SAR 228 million (+9% YoY), with special commission income surging to SAR 65 million (+54% YoY).

• Brokerage revenue stable at SAR 133 million; asset management revenue declined 17% YoY.

• Operating expenses increased 29% YoY, reflecting higher salaries, marketing, and technology investments.

• Cost-to-income ratio rose to 44% (up from ~37% YoY), driven by ongoing investments.

• Operating profit margin declined to 56% in Q1 2026.

Outlook and guidance

• Plans to launch new funds and products, including private credit, auto, and real estate funds by June 2026, targeting SAR 1.5 billion in new asset management inflows.

• Strategic focus on building a unified commercial engine, expanding brokerage and asset management, and developing an integrated tech platform.

• Cost-income ratio expected to remain above target (38-40%) through 2027 due to ongoing tech and strategic investments, normalizing from 2028.

• Planned cash dividend of SAR 0.33 per share for Q1 2026, pending approval.