SHUAA Capital

1. Company Overview & Earnings Context

SHUAA Capital PSC is a Dubai-based investment and financial services company listed on the Dubai Financial Market (DFM). Its businesses span asset management, investment banking and corporate investments, with a focus on the UAE, GCC and wider Arab region.

SHUAA reported H1 2026 net profit of AED 2.9 million, compared with AED 217.1 million in H1 2025. However, the prior-year result included a AED 214.8 million one-off gain from mandatory convertible bonds, making the headline YoY decline less reflective of underlying operations.

2. Financial Performance Snapshot

• Total Revenue: AED 39.4 Million (-19.5% YoY)

• Management & Performance Fees: AED 27.5 Million (-7.8% YoY)

• Advisory Fees: AED 3.4 Million (-79.8% YoY)

• Trading & Custody Revenue: AED 8.5 Million (+282.1% YoY)

• Total Expenses: AED 53.8 Million (+9.4% YoY)

• Operating Loss: AED 14.4 Million, vs. AED 0.2 million loss

• Net Profit: AED 2.9 Million, vs. AED 217.1 million

• Loss Attributable to Shareholders: AED 0.5 Million, vs. AED 214.4 million profit

3. Operational Highlights & Key Metrics

• Total Assets: AED 1.12 Billion

• Total Liabilities: AED 562.0 Million

• Total Equity: AED 556.0 Million

• Equity Attributable to Owners: AED 580.4 Million

• Investments in Associates: AED 364.6 Million

• Borrowings: AED 306.9 Million

• Cash & Cash Equivalents: AED 76.6 Million

• Operating Cash Flow: AED 55.5 Million, vs. AED 10.0 million outflow in H1 2025

4. Key Performance Drivers

Asset Management remained SHUAA's strongest operating segment, generating AED 27.9 million of revenue and AED 7.0 million of operating profit. By contrast, Investment Banking recorded an AED 1.7 million operating loss, while the Corporate segment recorded an operating loss of AED 19.7 million.

Trading and custody revenue was a key positive, increasing more than threefold to AED 8.5 million. However, this was offset by weaker advisory revenue and higher Group expenses.

SHUAA also benefited from AED 14.8 million of profit from associates and AED 16.3 million of other income, which helped the Group remain profitable despite the operating loss.

5. Outlook & Forward Considerations

SHUAA's most important near-term issue is its debt restructuring and refinancing. The Group has approximately AED 307 million of borrowings, including a AED 221 million bank term loan, with substantial borrowings repayable within the next 12 months.

The lender waiver has been extended until 31 August 2026, while SHUAA continues discussions on a comprehensive restructuring and refinancing agreement. Management expects to conclude a definitive agreement before the end of Q3 2026.

The auditor warned that failure to secure acceptable restructuring terms or further waivers could create liquidity pressures and potential default.

6. Investor Takeaway

SHUAA's H1 2026 results show a mixed operating picture. Revenue declined 19.5% and the Group remained loss-making at the operating level, although positive associate income, other income and improved cash generation helped produce a small net profit.

The comparison with H1 2025 is heavily distorted by the prior-year AED 214.8 million one-off MCB gain, so the more important indicators are the AED 14.4 million operating loss, positive AED 55.5 million operating cash flow and ongoing reduction in borrowings.

Two significant risks remain. First, completion of the AED 221 million bank facility restructuring is critical to liquidity. Second, the auditor issued a qualified conclusion relating to the valuation evidence supporting SHUAA's investment in Eshraq Investments.

The key factors to watch in H2 2026 are therefore revenue recovery, operating profitability, cash generation and successful completion of the Group's refinancing process.