Financial Services Company Sees Decrease in Net Profit in First Quarter of 2024
Al Ansari Financial Services (AFS), a prominent financial services provider in the United Arab Emirates, recently announced a net profit of AED 98.7 million for the first quarter of 2024 (Q1 2024). This figure marks a 26% decrease compared to the AED 133 million net profit recorded in Q1 2023.
The decline in profitability can be attributed to two main factors. AFS undertook a substantial branch network expansion in Q1 2024, leading to heightened operational costs. Additionally, the introduction of corporate tax in the UAE had a negative impact on the company’s financial performance.
Despite the decrease in net profit, AFS saw a positive growth in overall transactions, reporting a 5.1% year-on-year increase in total transactions across all its services. This growth was primarily driven by a notable 24% surge in Wage Protection System (WPS) transactions, indicating an increase in employment activity within the UAE.
Furthermore, AFS’s digital channels continued to thrive in Q1 2024, with a 25% year-on-year growth in the number of transactions conducted through its digital platforms. Digital transactions now constitute a significant portion (21%) of AFS’s outward remittances, reflecting the rising adoption of digital financial services in the region.
However, there was a decline in bank note volumes, with AFS reporting a 9% drop in Q1 2024. This decline could be attributed to various factors such as fluctuations in global travel patterns and the growing popularity of digital money transfer services.
Looking towards the future, AFS remains optimistic about its prospects. The company’s expansion into new markets, emphasis on digital transformation, and dedication to providing innovative financial solutions position it well for continued growth in the dynamic financial landscape. The successful integration of its recent acquisition in Oman is anticipated to yield synergies in the latter half of 2024, further strengthening AFS’s regional presence.
