Annual Report 2017

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Annual Report 2017 ANNUAL REPORT PADICO HOLDING ANNUAL Palestine Development and Investment, Ltd. REPORT Foreign, limited, public shareholding limited Liability Company, registered in the Republic of Liberia Under the Liberian Business Law of 1977 Years of success Contents About PADICO HOLDING 6 FUTURE VISION 40 42 PADICO HOLDING: 8 Social Responsibility Twenty-three years of investment in Palestine Financial Performance in 2017 48 Board of Directors 10 Key Financial Indicators 54 Shareholder 15 Performance of PADICO HOLDING share 56 The Chairman Message 18 Auditors’ Report and Consolidated 58 Performance Summary of Investment 20 Financial Statements About PADICO HOLDING Our Values and Mission Our Strategy PADICO HOLDING believes in the importance of PADICO HOLDING is committed to developing its role and contribution in building the Palestinian the Palestinian economy through a group of PADICO HOLDING Company was established in 1993 as a foreign limited liability economy. It has several leading companies that subsidiaries and affiliates that invest in key sectors holding company registered in Liberia at the initiative of prominent Palestinian and contribute to the economic development of Palestine constant with the company’s overall strategy, Arab businesspersons with the aim of contributing to the building and development by implementing investment projects in various including real estate, communications, tourism, of the Palestinian economy by establishing development projects in vital economic economic sectors, creating jobs and launching industry, agriculture, the environment and financial creative economic initiatives in partnership with services. PADICO HOLDING’s ability to generate sectors. public sector institutions. Moreover, attracting local profits depends mainly on the performance of its and international investors and encouraging them subsidiaries and affiliates. PADICO HOLDING’s The company’s capital is 250 million shares with a nominal value of one US dollar per to invest in Palestine. strategy to diversify investment in several sectors share, and its shares have been traded on the Palestine Exchange since 1997. and geographical areas has enabled it to become PADICO HOLDING is committed to its ethical and a leading investment and development company The number of shareholders in the company has gradually increased from 710 in 1998 societal role towards the company’s society and in Palestine. PADICO HOLDING is unique in to about 7394 in 2017. PADICO shareholders include investors from North Africa, and local community. It is an international company nature compared to other Palestinian companies with a set of values, principles, standards of the Middle East including Palestine and Jordan. and international companies; its board members governance and best management practices. As a have international expertise in various economic national company, PADICO HOLDING commits to sectors. The company is characterized by its ability a group of strategies and ethics in all practices and to enter into large-scale investment projects with activities. It also aims to improve the internal working a guaranteed return. The diversified investment environment, adopt responsible investment projects strategy has provided an opportunity for increased and continue to commit to supporting community returns over the past years despite the difficult and development initiatives and projects. circumstances, which have made it a model for investment in Palestine. Our Advantage PADICO HOLDING is a leading investment company with a long-term development orientation. The company has demonstrated its ability to enter into large-scale, promising and promising investment projects over the past years. Its members have international expertise in various sectors of the economy and entrepreneurship, contributing to the enhancement of its vision and direction and the development of a flexible strategy based on diversification of investment to ensure accumulated returns that support both sustainable and active development objectives. In spite of all challenges, the prudent plans of the board of directors have contributed to maintaining the investment orientation of the company. PADICO HOLDING is strategy based on investment diversification. This has enabled the company to achieve continuous returns over the past years despite difficult circumstances. 7 PADICO HOLDING Twenty-three years of investment in Palestine At the beginning of every year, PADICO HOLDING proudly grasps the opportunity to celebrate the previous year’s remarkable achievements which would not have been possible without the invaluable faith and sincere admiration of our stakeholder and the trust which they have instilled in us. As we embark on a third decade of PADICO, two decade, we renew our gratitude and commitment to a leading and pioneer company striving for a bright and better future for our country and our people. Serving as a deep cornerstone and key factor in building national economy in the future State of Palestine and in contributing to shape a future oriented towards decent life, several job opportunities and full citizenship. Years of success 9 Board of Directors Munib R. Masri Nidal M. Sukhtian Ammar A. Aker Kameel A. Saad Edeen Chairman Vice Chairman Board Member Board Member Sabih T. Masri Bashar F. Masri Jamal S. Hourani Yazid A. Mufti Board Member Board Member Board Member Board Member Nabil G. Sarraf Zahi W. Khouri Omar A. Bitar Iyad N. “Darwish Hajji” Board Member Board Member Board Member Board Member ANNUAL REPORT | PADICO HOLDING 11 Governance Board of Directors’ Committees PADICO HOLDING governance is considered an integral part of its management principles. It is a strategic necessity to ensure that the company is moving in the right direction, anticipating future The Board of Directors has established the following committees: horizons, optimizing the use of resources, and distributing the functions and powers among the board members and the Board of Directors and the executive management. It is a fundamental The Executive Committee, The Audit Committee, principle that ensures the company’s compliance with international standards, including a sound members of the committee: members of the committee: working environment, a code of conduct that controls the working environment, and regulates the company’s relationship with its external environment, which is a social extension. PADICO HOLDING’s Bashar F. Masri (chairman) Yazid A. Mufti (chairman) restructuring of investments has contributed to the promotion of best practices and good governance, Nabil G. Sarraf Kameel A. Saad Edeen and in improving the efficiency and effectiveness of the systems in which it operates. Ammar A. Aker Ziad M. Turk The company is committed to periodical publishes of its quarterly and annual financial reports. In addition to quarterly and annual disclosures, and press releases which highlights its latest events such as social responsibility programs, sustainability programs and environmental protection. The Company is also committed to issuing annual reports in accordance with the requirements of the Legal Advisors: Capital Market Authority of Palestine and the Palestinian Stock Exchange. Sanad Law Group association with Eversheds – International In 2012, PADICO HOLDING completed a study conducted by the International Finance Corporation Haytham Al Zubi – Palestine (IFC), and the investment arm of the World Bank Group, to develop the governance principles of PADICO HOLDING. This aims to enhance its compliance with international standards and regulations and to benefit from international experience in the areas of governance. The study included a External Auditors: Main Banks: comprehensive review of the company’s governance and transparency, and recommendations for its Ernst & Young Arab Bank | Cairo Amman Bank development. PADICO HOLDING currently relies on the recommendations of the study as a reference for strengthening the principles of corporate governance and best practices within the company. Including the role of the board of directors in terms of structure, functions and competencies, the relationship with shareholders and the community, or the standards of periodic reports and disclosures, Executive Management: in addition to standards that meet the environmental requirements of the company’s projects. Ziad M. Al Turk Secretary General The Role of the Board of Directors and its Committees and Mechanism Nihad T. Kamal Secretary of the Executive Council Amjad Y. Hassoun Chief of Financial Management The Functions of the Board of Directors Nimer Abdel Wahed Real Estate Consultant The Board of Directors of PADICO HOLDING consists of thirteen members. Its functions to follow up the progress of the company’s business, strategy and future plans. It also aims to review the Saeed Y. Dwikat Chief Development Officer political and economic conditions and variables that affect the next phase, in addition to approving budgets, financial and investment regulations and policies and approving the financial statements. Jihad A. Zammari Internal Audit Manager The company is committed to the principles of governance by making decisions by majority. The minimum number of members of the Board of Directors is 100,000 shares, and neither the Chairman Rasha K. Metwalli Administrative Manager nor the members of the Board of Directors have executive positions either in the Company or in its subsidiaries. Over the past few years, the Board of Directors has formed a number of internal Samer M. Safadi committees,
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