CEO's Message

In the Name of Allah, the Most Merciful, the Most Compassionate

Praise be to Allah, the Lord of All Worlds and prayers and peace be upon the Prophet (pbuh) and his family, companions and followers.

Our valued shareholders, Allah's peace, mercy and blessings be upon you
On behalf of the Executive Management of A'ayan Leasing and Investment Company, 1 have the pleasure to present this report highlighting the Company's performance and Key financial indicators for the year ended 31 December 2022 and to briefly highlight the updates on key financial and economic development the year 2022

Overview of the Economic Situation in 2022
Last year, the world underwent extraordinary and complex challenges that may be the most difficult since World War I1. While the world's economies began to adapt to the consequences of the Coronavirus pandemic and the concomitant closure of commercial activities as well as response to health and psychological effects, which affected all humanity, the global economy faced a new shock due to the Russian-Ukrainian war, which has affected the entire world. In addition, production baskets worldwide were affected by the new global situation triggered off by the conditions of return from the total shutdown of factories around the world at varying times, severe shortages of natural resources and a sharp hike in the prices of fuel, food and other natural resources, which inescapably led to the rise in inflation all over the world.

Global growth rates slowed down owing to surging inflation, high interest rates, and political instability caused by the Russian war, and according to the World Bank, the global economy is forecast to grow up by 1.7% in 2023 and by 2.7% in 2024. The sharp drop in growth is predicted to be broad-based, with forecasts revised down to around 95% of advanced economies and roughly 70% of emerging markets and developing economies, with growth in advanced economies, according to the report, expected to slow from 2.5 percent in 2022 to 0.5 percent in 2023. Over the past couple of decades, global economic slowdowns of this magnitude have harbingered a world recession. In the US, growth is projected to slow to 0.5% in 2023, 1.9 percentage points lower than previous forecasts. marking the weakest performance outside of official recessions since 1970. In 2023, Eurozone growth is projected at 0%, down from 1.9% after the forecast was revised. In China, growth is projected at 4.3% in 2023, 0.9 percentage point lower than previous forecasts.

Overview of the GCC capital markets during 2022
Undoubtedly, the global economic factors we have mentioned have affected the region's markets. Most markets in the region ushered in the year 2022 with hopes of recovery from the coronavirus crisis, but this optimism quickly faded at the end of the first half of the year as a result of global changes.

The Kuwaiti stock market witnessed mixed performance in its sectors, with the Boursa Kuwait General Index having risen by 3.5% to 7,292.12 points, and the Premier Market Index by 6.2% to close at 8, 115.68 points, while the main index nosedived by about 4.9% to 5,596.79 points, after having recorded the best annual performance in its history during 2021.

The performance of the Saudi market declined over the past year for the Birst- ume in seven years, with the Saudi stock market index (TASI) having fallen by 7.12% to close the year at 10,478.46 points. Still, the Saudi market maintained its position as the largest market in the region by market capitalization.

Accordingly, the performance of the GCC capital markets varied during 2022. The Abu Dhabi market was the leader with 20.03%, compared to its increase of 68% in 2021, as the Abu Dhabi Securities Exchange index ended 2022 trading at 10,188.57 points and Dubai Securities Exchange index hiked by 4.4%. Last year, the UAE's capital markets witnessed 11 Initial Public Offerings (IPOs) valued at approximately $13.94 billion.

The Muscat Market Index was the second largest GCC index; having gone up by 17.63% during the year to settle at 4,857 points, while the Bahrain Bourse index rose by 5.45% and Qatar's index ended at 10,681 points, down 8.13%, during the year.

Overview of the performance of A`ayan Leasing and Investment Company during 2022
Last year, the company achieved positive operating results in its various key sectors (leasing, investment, real estate). The company's operating profits rose by 91% in 2022. The company also managed to achieve a 48% hike in its net profit to hit 9 million Kuwaiti dinars, pushing basic and diluted earnings per share (EPS) to reach 13.18 fils per share up 60% from the previous year. Book value per share increased to 137 fils per share from 124 fils at the end of 202 1.

Considering the company's sectors, the executive management team worked to implement the decided strategy to rebuild the balance in the company's assets, to carefully expand the leasing sector, and to run investments with better returns to compensate for low-income investments. In the leasing sector, leasing
income increased to KD 15.7 million during the year, up 11% from 2021. The number of vehicles operated by the company increased to 8,276, including inventory, up 20% from 2021

In the real estate sector, the company's management worked on three main axes over the past year. The first axis was to improve the performance of real estate owned by the company, and the second was to exit properties that did not fulfill the targeted revenues after efforts had been exerted in order to improve their
performance by all means. Finally, the third axis was aimed at seizing the available real estate opportunities.

At the advent of 2022, the investment related real estate sector witnessed remarkably low demand, which directly resulted in a decline in rental values in many areas. In the middle of the year, there was some sort of stability in some areas, as the company's real estate management continued promotional efforts through
companies specialized in real estate marketing and developing the company's properties in order to attract tenants, and to maintain and enhance occupancy rates in real estate.

Thanks to tireless internal efforts, an internal electronic real estate system was implemented, linking the company's various departments in a bid to build an integrated database covering the status of the company's real estate, collection processes and legal procedures taken against defaulters. The new system has
greatly succeeded in activating the collection process and following up on legal procedures in a timely manner. The electronic collection process for monthly payments has also been activated directly via the company's real estate system.

In the private equity sector, the investment team studied a large number of investment opportunities in different sectors such as health, education, real estate, nutrition, automotive and other sectors. The company has increased its strategic investment in Tawazun Holding Company, bringing A'ayan Company's ownership to 44% of Tawazun, which owns considerable percentages in many listed and unlisted companies such as Aayan Real Estate Company, Mashaer Holding and Yaal Mall. The team has been close to the Kuwaiti stock market and available Initial Public Offerings (IPOs) during the past year, and worked to seize operational investment opportunities with attractive returns and high liquidity.

In the asset management sector, despite the economic slowdown after the world went through the Coronavirus pandemic crisis and the high inflation rates and their impacts on the operating environment, the performance of asset management was satisfactory in terms of customer asset management, as Net Assets
with Value obtained the of to various extend the contractual liquidation collective period, investment and the schemes liquidator is whose studying liquidation all is available being options followed that up, enable the the approval of shareholders the Capital of the Markets systems to Authority obtain has the best been
Awaed Real Estate Fund increased to reach KD 17.2 million, while maintaining the net unit value in the fund to remain 604 fils per unit. In connection
possible return.

A'ayan Company's executive team continues O achieve the business strategy approved by the Board of Directors, and focusses more attention in achieving positive operational results that will maximize shareholders equity and enhance the company's position in the market.