Top Contractor Arabtec Swings to Third Quarter Net Profit
Arabtec Holding, a leading UAE-based contractor for social and economic infrastructure, has registered a net profit of Dh18 million ($4.9 million) for the third quarter compared to a net loss of Dh226 million ($61.5 million) for the same period in 2016.
Announcing the results for the nine months ending September 30, Arabtec said its revenue surged to hit Dh6.34 billion ($1.72 billion) posting a 3.2 per cent year-on-year growth over Dh6.1 billion last year.
Its net profit for the nine-month period soared to Dh75 million compared to Dh458 million in net losses recorded for the same period last year.
In the third quarter, Arabtec continued to strengthen its management with the on-boarding of key appointments, underpinning the development of capable, empowered senior management across the group.
The Group continues to assess further divestments and options to more seamlessly integrate its operating companies to improve efficiency and productivity.
In the quarter, Arabtec divested its 14.6 per cent stake in Jordan Wood Industries PSC, a listed Jordanian company, which manufactures office and household furniture.
During the nine-month period, Arabtec had several major new wins including the Dh628 million contract for 1,296 villas at Akoya Oxygen from Damac, the Dh363 million contract for Dubai South Mall and Dh196 million Phase 1 work of Forte in Downtown Dubai (both from Emaar)
On the solid results, Group CEO Hamish Tyrwhitt said: "We have now delivered our third consecutive quarter of profitability, supported by new project wins across our operating companies. The Group remains on track to achieving the first phase of its strategic road map to “stabilize” the business in 2017, ensuring long-term, profitable and sustainable growth."
A key highlight in the quarter was the announcement by the Abu Dhabi Tourism & Culture Authority that the Louvre Abu Dhabi will open in November 2017, stated the top official.
Arabtec had played a key role in delivering this landmark project which highlights its contribution and competencies in delivering social and economic infrastructure in the UAE, he added.
Tyrwhitt said Arabtec was proud to have taken part in the delivery of such an iconic project in the UAE.
The UAE contractor's backlog remained srong at Dh16.8 billion, supported by new project awards across all operating companies, reflecting a more selective approach to tendering.
Arabtec remains confident that the strength and quality of the new work pipeline in the region will continue to support the Group’s business objectives, said Tyrwhitt.
He pointed out that strengthening governance had been an ongoing focus for the group with the continued roll out of the 4-Gate Work Winning Process across all operating companies, which is demonstrating a more selective approach to Arabtec’s new work pipeline through a clearer understanding of the addressable market including, core competencies, geographies, sectors and clients.
Operationally, Arabtec continued to drive accountability into the business through rigorous project and business performance reporting and reviews, with a strong emphasis on cash, receivables and
closing out legacy projects, remarked Tyrwhitt.
"Overall I am pleased with the progress made so far this year to stabilize the business. I look forward to making further progress in Q4 on divestments and closer integration of our operating companies alongside strengthening our risk management processes," stated the company chief.
"These final deliverables will put us on track to “prepare” the business for growth in 2018, he added.
Source: Trade Arabia
A leading engineering and construction Group specialising in complex projects in the Middle East and North Africa. Through its operating companies and investments, the Group delivers construction and infrastructure projects, including commercial, residential, social, industrial and economic infrastructure in UAE and other selected countries in the region. The UAE-based group’s list of completed projects includes iconic buildings such as the world’s tallest building, the Burj Khalifa in Dubai, Abu Dhabi landmark, the Emirates Palace Hotel and Louvre Abu Dhabi Museum; as well as other technically challenging work on airports and related infrastructure.