Mubadala reported a Dh10.9bn ($2.9bn) profit in the first half of the year on the back of strong performances from the Abu Dhabi investment company’s public equities portfolio and its petroleum and petrochemicals operations.

The sovereign fund did not provide comparable profit figures for the same period last year, saying it was still consolidating the financial reporting of Abu Dhabi Investment Council, another state investment fund with a large banking portfolio that was brought into the Mubadala group earlier this year.

Total assets, including Adic, rose to Dh832bn, compared with Dh469.4bn at the end of 2017, it said.

Mubadala, which merged with Investment Petroleum Investment Company in 2017, is now at the forefront of the emirate’s direct investment strategy, at a time when the oil-rich emirate’s economy has suffered from a prolonged slowdown.

“We continued to deploy capital in new sectors and geographies,” said Khaldoon Al Mubarak, group chief executive. “We also monetised select assets at good valuations, to deliver financial returns.”

Cepsa, the Spanish oil group owned by Mubadala, has launched plans for an initial public offering of 25 per cent of its shares later this quarter. The oil group expanded its upstream business this year with the award of a 20 per cent stake in a 40-year concession by Abu Dhabi’s state oil company.

“Mubadala needs to show it can harvest money as well as spend it,” said one banker.

The government has been seeking greater economic efficiencies by consolidating state-backed investment companies and banks.

First Abu Dhabi Bank, formed last year through the combination of First Gulf Bank and the National Bank of Abu Dhabi, has created a national banking champion but also caused widespread redundancies.

Talks about consolidating three other Abu Dhabi banks could bring further efficiencies to the emirate’s crowded banking sector while also threatening another round of lay-offs further dampening domestic demand.

Abu Dhabi is trying to treat the domestic economic malaise with plans for a Dh50bn three-year stimulus package, with Dh20bn earmarked for spending next year.

Get alerts on Mubadala Investment Company PJSC when a new story is published

Copyright The Financial Times Limited 2019. All rights reserved.
Reuse this content (opens in new window)

Follow the topics in this article