EXCPR™: THE DIVIDENDS FOR COMPANIES IN BOURSA OF KUWAIT

THE DIVIDENDS FOR COMPANIES IN BOURSA OF KUWAIT

The stock market is one of the most critical economic indicators that reflects the actual operational performance of private sector, as well as the ability of the executive management to achieve the highest financial returns for investors. Investment in the stock market is also a major concern for members of the Kuwaiti society. Despite the decline in the percentage of trades on Boursa Kuwait during the last decade from USD 330 million to USD 83 million per day, however, it still keeps the direction and attention of investors and the small one in generating wealth. EXCPR Co. results shows that there are almost 170 companies in different sectors of work, the number of companies that have been in the recent withdrawals is competing with each other in attracting more capital and investors in general, to serve as a platform for evaluating operational performance. As for the link between the importance of Boursa Kuwait and strategic vision of the country "Kuwait 2035", Boursa Kuwait is considered the focus of the foreign investor, who seeks the vision of the strategic state to attract him towards importing more money into local listed companies. To shed light on the operational performance of companies listed on Boursa Kuwait, EXCPR Co. consultancy and business management has been working on this national initiative, which is an important indicator for investors and business people, towards obtaining a substantial financial return and capital deliberation.

Cash Dividend
Investors and business people often seek to capture the most important investment opportunities and reduce risk, by carefully studying the different financial markets and companies, and by looking for the best performers. EXCPR Co. has been following the various dividend of companies listed on Boursa Kuwait since 2010 to determine the most accurate results. The company's research indicates that the best company has distributed cash dividends over the past 10 years in the Kuwaiti market, is Ooredoo - mobile network Co. - valued at USD 0.3 per share. Also Kuwait Portland Cement Co. is competing with Ooredoo, with an annual cash dividend rate of approximately USD 0.3 per share. While the third place, was that of human soft holding, with a profit distribution rate of about USD 0.24 per share. The following table shows the top 20 prominent companies listed on Boursa Kuwait in terms of cash distributions during the period between 2010-2018:

The results of the company also indicate that there are some companies listed in the market, which regularly distribute annual profits, thanks to its executive management and its strategy. Although its cash distributions have declined in some years, it has maintained continuity and consistency in the realization of shareholders ' rights. Below is a list of those companies that have not interrupted the distribution of cash dividends over the past 10 years:

· National Bank of Kuwait- NBK

· Alahli Bank of Kuwait

· Ahli United Bank

· Kuwait Finance House- KFH

· Commercial Facilities Co.

· Kuwait Projects Holding Co.

· Tamdeen Investment Co.

· Kuwait Insurance Co.

· Gulf Insurance Group

· Al Ahlia Insurance Co.

· Salehiya Real Estate Co.

· Al Tamdeen Real Estate Co.

· Kuwait Cement Company

· Kuwait Portland Cement Co.

· ACICO Industries Co.

· Alkout Industrial Projects Co.

· Kuwait National Cinema

· Agility Public Warehousing Co.

· Mobile Telecom. Co. –Zain

· National Mobile Telecom. Co. –Ooredoo

· National Petroleum Services Co.

· The Kuwait Co. for process plant construction and contracting

· Combined Group-Contracting Co.

· Palms Agro. Production Co.

· Alafco aviation lease and finance

Stocks dividend

Other types of investors are usually looking for long-term investment, by focusing on the selected quality of companies with effective executive management. Therefore, the distribution of grants provided by companies listed on Boursa Kuwait has been tracked over the past 10 years. The results of EXCPR Co. research indicate that the automated systems company is one of the leading companies in the local market, for the distribution of grants-equities-by 12% per share per year. KFH came second in terms of the grant distribution rate of 10% per annually. The Humansoft holding co. also occupied third place for the largest distribution of profit grants, estimated at about 8%. The following table shows the most prominent companies that have distributed grants to their shareholders over the years from 2010 to 2018:

The long-term investment strategy is based on the management of companies that continue to distribute grant dividends to their shareholders continuously. Although there are some fluctuations in different markets, the following companies listed in the market have adopted a policy of continuous distribution of profits to win the confidence of shareholders:

· National Bank of Kuwait- NBK

· Ahli United Bank

· Burgan Bank

· Kuwait Finance House- KFH

· Boubyan Bank

· Mabanee Co.

· ACICO Industries Co.

· Kuwait and Gulf link transport Co.- KGL

Not active

As explained in the previous part of this project, about 20% of the companies listed on Boursa Kuwait are distributing dividends – cash and shares and – well during last years. In contrast, the results of EXCPR Co. project indicate that about 29, 4% of listed on Boursa Kuwait are not active in terms of dividend distribution over the past 10 years. As the term ineffectiveness means, there are about 50 companies listed on Boursa Kuwait, which have not distributed any types of profits – both cash and stocks – to their shareholders since 2010 for different reasons and policies!!

Cash dividend per year

The rate of cash distributions to companies listed on Boursa Kuwait during the previous 10 years was USD 3.2 Billion annually, which constitutes about 2.6% of the national income of the State of Kuwait and its GDP. As shown in the following figure, the peak period for the cash distributions of listed companies was in 2010, which was a total value of USD 5.4 Billion. The lowest of these distributions was in 2012, when they were only USD 3.1 Billion.

Stocks dividend per year
The results of the research carried out by EXCPR Co. indicate that the rate of stocks dividends for companies listed on Boursa Kuwait over the past 10 years was 1.2% per year. As shown in the figure below, the years 2016/2017 are the years with high cash distributions, while their performance was what companies achieved last year-2018.

Finally, if investors and business people want to reduce the chance of risk and seize more investment opportunities, they should closely follow the behavior of such companies and equities. Such reports and financial statements, which are based on transparency and clarity, will support the foreign investor, who is looking for accurate financial data and technical indicators, to guide capital in the GCC markets.