Derayah Financial (4984) Q2 2025 earnings summary

Executive summary

• Achieved record Q2 2025 results with total operating income of SAR 235 million, up 11% year-over-year, and 1H 2025 operating income of SAR 444 million, up 2% year-over-year, driven by higher trading volumes and asset management revenues.

• Operating profit for Q2 2025 surged 37% year-over-year to SAR 141 million; 1H 2025 operating profit reached SAR 273 million, up 7% year-over-year.

• Net profit for Q2 2025 reached SAR 145 million, a 36% increase year-over-year; 1H 2025 net profit was SAR 213 million, down 6% year-over-year due to associate losses, with core net profit (excluding D360) up 8% to SAR 276 million.

• Client accounts grew 9% year-to-date to over 580,000, with assets under custody up 16% to over SAR 35 billion.

• Demonstrated resilience and agility amid significant market volatility, including geopolitical tensions and domestic reforms.

Financial highlights

• Brokerage revenue for 1H 2025 rose 11% year-over-year to SAR 269 million, with Q2 2025 up 18% year-over-year.

• Asset management revenue for 1H 2025 declined 10% year-over-year to SAR 63 million, but Q2 2025 saw 8% year-over-year growth.

• Special commission income dropped 27% year-over-year in 1H 2025 to SAR 79 million, reflecting lower interest rates.

• Investment gains reached SAR 33 million in 1H 2025, up 141% year-over-year, with Q2 2025 at SAR 33 million, up 676% year-over-year.

• Cost-to-income ratio improved to 38.5% in 1H 2025; capital adequacy ratio increased to 28.4%.

Outlook and guidance

• Medium-term guidance targets 7%-8% brokerage revenue growth, 22%-24% asset management revenue growth, and 7%-8% special commission income growth.

• AUM expected to grow ~20% with fees around 100bps; AUC to grow mid-teens with blended fees 50-70bps.

• Cost-to-income ratio guidance remains at 38%-40%; ROE targeted above 40% and dividend payout ratio above 60% of net income.

• Early Q3 results in July are positive, with expectations for continued momentum.

• Management expects continued growth from product enhancements, including SBL and new fund launches.