First-half results of the company, jointly owned by the governments of Dubai and Abu Dhabi, show evidence of the improving trend as sales in the second quarter of 2009 showed a 30 per cent improvement over the first three months of the year despite overall decline in the first half, the company said in a statement.
The total sales of Dh1.2 billion for the first half, which shows an 18 per cent decline over the first half of 2008, was in line with the lower activity in the real estate sector and was due to the impact on sales value of the sharply lower copper prices.
“The first quarter of the year was characterised by uncertainty and this adversely affected our sales, but we see the improvement in demand in the second quarter as construction projects have restarted and some stability has returned to the market,” Andrew Shaw, Managing Director of the company, said.
Copper, a key raw material for cable, reached a peak price of over $8000 per tonne in 2008 before falling to under $3000 in early 2009. Prices have since recovered to $5000-6000 per tonne.
“We expect this gradual improvement to continue in the second half as the economic situation improves and we begin to see higher sales in some of our new export territories in the MENA region,” Shaw said.
Ducab has been working on streamlining operations and improving efficiencies across the business since late 2008 with projects across all three manufacturing sites aimed at improving yields and reducing costs.
Looking ahead to 2010, Ducab continues to invest in new capabilities and capacity. The company’s Special Cables Unit for oil & gas cables is nearing completion in Jebel Ali, while the construction of the new high voltage factory (Ducab-HV, jointly owned by Dubai and Abu Dhabi utilties), also in Jebel Ali, has already commenced. The company also recently announced expansion in Qatar.
Ducab factories can produce over 110,000 metal tonnes equivalent of high, medium and low voltage cables. The product range covers High Voltage cables up to 132kV, Ducab Powerplus Medium Voltage cables, Low Voltage power cables, control & auxiliary, flexible and building wiring and lead-sheathed cables, Ducab-Smokemaster, Low Smoke and Fume cables, and Ducab-FR (Fire Resistance Cables), Ducab connect- cable components and accessories, as well as copper rod that Ducab manufacture in their own copper rod plant.
Ducab’s advanced cable solutions have laid the foundation for projects ranging from world-renowned hotels, island communities, hospitals, airports, oil refineries and government utilities.