Khaldoun Tabari, CEO of DSI
Drake & Scull International PJSC (DSI), a regional market leader in the integrated design, engineering and construction disciplines of Civil Contracting, Mechanical, Electrical and Plumbing (MEP), Water and Power, Rail and Oil and Gas reported today the financial results for Q1 2014 ended March 31st.
Revenues for the Quarter were sustained compared to last year and closed at AED 1.25 billion driven by a solid contribution from the KSA, UAE and Iraq markets each accounting for 53 %, 18% and 5% respectively.
Earnings per Share (EPS) Stood at AED 0.0176 and Net profit reached AED 45.7 million.
The quarterly contribution of the General Contracting Business to the bottom line stood at 24.6% representing a decrease of 35.9% compared to Q1 2013.
The Engineering Business generated 56.8% of the cumulative Net profit achieved in Q1 2014 up by 11.1% compared to the same period last year. The Oil & Gas division continues to achieve solid results in Southern Iraq contributing 18.5% of the quarterly Net profit indicating an increase of 77.9% compared to last year.
DSI continues to increase its market share in the MENA region and managed to secure AED 1.1 Billion worth of new contracts across all markets in the first quarter. The company started the year with a strong momentum in the UAE which accounted for 49% of the new project awards while KSA accounted for 31%. Through its German subsidiary the company managed to secure a series of contracts across the Waste Water and Water Treatment sector in Q1 taking the contribution of the European and Indian markets to 15% and 5 % of the new projects awards in Q1 2014 respectively.
The Order Backlog reached AED 12.2 billion representing a year on year increase of 35.8%. KSA and the UAE remain the largest contributors to the backlog accounting for 41 % and 19% respectively as of the 31st of March 2014.
Commenting on the results, Khaldoun Tabari, CEO of DSI said, “The first quarter shows signs of improvement in our industry, overall sentiments across the region are more positive and developments are once again moving forward. Despite the severe competition the greater overall outlook is that 2014 is expected to bring in a significant increase in momentum with more market activity. Our projects in the GCC are delivering seamless results and our operations in the LEVANT, North Africa, South Asia and Europe are steadily progressing and are also a vital part of our future revenue stream.”
“We will continue to increase our portfolio, and invest in cutting edge technology in order to expand our global presence by venturing into new markets and creating more opportunities for development across every segment of our business. "
Mukhtar Safi, CFO of DSI added, “Q1 witnessed increased productivity from our Engineering Business across all markets and a slowdown in our General Contracting business in KSA due to unforeseen delays in two major projects which are not recurring and we expect our portability margins in this sector to improve in Q2 2014. The Oil & Gas business achieved a substantial increase in its contribution to the cumulative top line and bottom line growth with sustained Net margin at 13%. We have managed to maintain our receivables days and we are keen on enhancing our working capital as we expect improved collections and liquidity in Q2 2014. Our main strategy for the year is to strengthen our balance sheet and reduce costs to deliver on our growing backlog. We expect in 2014 accelerated growth for DSI in emerging markets and particularly across the Oil & Gas and Rail sectors,” Mukhtar concluded.