Arabtec's Q2 revenue swells 20%

Dubai - The company was working on projects worth a total of Dh22.6 billion in the quarter

Arabtec on Sunday declared a 20 per cent year-on-year growth in the second quarter revenue and also reported a narrower loss for the June quarter compared to a year earlier.
The Dubai contractor's revenue increased from Dh1.8 billion in the second quarter of 2015 to Dh2.2 billion in the same period in 2016.
The builder of Burj Khalifa made a net loss attributable to equity holders in the parent of Dh186.4 million in the three months to June 30. This compares with a loss of Dh718.4 million in the corresponding period of 2015. EFG Hermes had forecast Arabtec would make a quarterly net loss of Dh83.2 million.
Arabtec's direct costs in the second quarter totalled Dh2.15 billion, almost as much as the revenues it earned in that period.
"The direct costs are still too high, which is a problem. There was a good improvement in the first quarter but that has not been sustained in second quarter," Sanyalaksna Manibhandu, head of research at NBAD Securities, told Reuters. The company's finance costs from continued operations rose 89 per cent from the year earlier period to Dh17 million during the quarter. The rise was due to increased borrowings for working capital for new projects, it said.
The company was working on projects worth a total of Dh22.6 billion in the quarter, it said, up 12 per cent from the previous year.
Arabtec is aiming to break even this year and return to profit in 2017, its chairman said in April. "Unless there's improvement in the second half of the year, you'll doubt whether they'll break even this year," Manibhandu said.
During Q2, the group also commenced construction works for a number of major projects including Bahrain International Airport, West Yas villas, the 1,100 villas project for UAE Nationals in Fujairah, the 500 villas project for UAE Nationals in Oud Muteena and the twin towers project in central Dubai.
During H1 2016 Arabtec has secured new projects wins of Dh9 billion, including: the Bahrain International Airport Modernisation Programme for a Dh3.7 billion; 1,100 villas for UAE nationals in Fujairah for Dh1.7 billion and 500 villas for UAE Nationals' Housing in Oud Muteena for Dh500 million.
- abdulbasit@khaleejtimes.com