Saudi Tadawul Group, a holding Company (the "Group") today released its 2020 Annual Report for the period ended 31 December 2020.
The Saudi Stock Exchange (Tadawul) announced its transformation into a holding group structure, Saudi Tadawul Group, in Q1 2021. The Group is the parent company of four wholly owned subsidiaries: The Saudi Exchange, a newly incorporated dedicated stock exchange business (previously Tadawul), the Securities Clearing Center Company (Muqassa), the Securities Depository Center Company (Edaa), and Wamid – a new innovative applied technology services business.
The Group increased its operating revenue by more than 91% to SAR 1.1 billion in 2020 driven primarily by an approximate 141% increase in trading commissions. Operating costs increased by approximately 9% during the same period to SAR 356 million. This, together with the increase in operating revenue, resulted in a 203% increase in gross profit to SAR 723 million in 2020.
General and administrative expenses decreased by approximately 8% to reach SAR 180 million in 2020, which when factoring in the increase in operating revenue, resulted in an increase of more than 10 times in operating profit to SAR 543 million. Non-operating profit reached SAR 41 million in 2020, a decrease of approximately 63%, primarily driven by a decrease in investment income of approximately 59%. Profit for the year before Zakat increased by 281% to reach 584 million and profit for the year after Zakat increased by 227% to reach SAR 500.5 million.
Operationally, the Group achieved many notable milestones in market development activity, as it completed its fifth and final phase of the inclusion of the FTSE Russell Emerging Markets Index of Saudi Arabian stocks into its index series, launching its derivatives market, the MENA region’s first gold Exchange Traded Fund (ETF), introducing the MT30 Index Futures, and the iBoxx Tadawul SAR Government Index and SAR Government Sukuk and Bond Index in collaboration with IHS Markit, among others.
At year end, the Group's main market capitalization stood at SAR 9.1 billion, an increase of 0.85% compared to SAR 9.0 billion in 2019. It currently accounts for approximately 77% of the total market capitalization of MENA stock exchanges. The Saudi Exchange has the highest market capitalization to GDP ratio among leading emerging markets, reaching in excess of 356%.
Sarah Al-Suhaimi, Chairperson of Saudi Tadawul Group, said: "We ended the year with a laudable performance which confirms our strengths, resilience, and innovativeness. The achievements of the last few years give us an excellent foundation on which to build our business further. We have much to look forward to by way of introduction of new products and services and strengthening our regional as well as global links, in alignment with the Kingdom vision 2030 Financial Sector Development Program (FSDP) and Public Investment Fund (PIF) Strategy."
Eng. Khalid Al-Hussan, CEO of Saudi Tadawul Group, commented: “The Exchange delivered a commendable performance during 2020, despite the adverse conditions local and global markets faced. It has proven tenacious and resilient, as it recorded an impressive and strong financial performance over the past year. We are on an exciting growth trajectory reinforcing our position as a global market leader and advanced capital market, and look forward to delivering on our promise to provide access to attractive investment opportunities, diversify the economy and support issuers and investors to achieve their ambitions."
Key financial and operational highlights from 2020 include:
- Operating Revenue increased by 91.3% to reach SAR1.1 billion, driven by higher trading volumes.
- The Group achieved a 281% increase in profit before Zakat to reach SAR584 million and profit for the year after Zakat increased by 227% to reach 500.5 million
- Our stock exchange ended the year as the ninth largest exchange in the world in terms of market capitalization.
- The main market index (Tadawul All Share Index - TASI) reported an increase of 3.58%, while the parallel market index (Nomu Parallel Market Index) reported a 252% increase, a 0.85% and 379% increase in market capitalization respectively.
- The number of Qualified Foreign Investors increased by approximately 18.6% from 1,939 in January 2020 to over 2,300 at the end of the year and were net buyers of SAR 22.4 billion for the same period.
- The Securities Clearing Center Company, Muqassa, obtained a license by the CMA as qualified Counterparty Center and also joined the International Association of Central Clearing Centers (CCP12).
- The launch of a new company, Tadawul Advanced Solutions Company, "Wamid".
To view the Saudi Tadawul Group’s financial and operational highlights in more detail, please visit the interactive electronic version of the report here