Profits fell 10.2 per cent in second quarter, as revenue declined
Egypt's Orascom Construction battles new order downturn
Orascom Construction, the top Egyptian contractor reported a 10.2 per cent loss in second quarter earnings as revenue declined.
Net income for the three months ending June fell to US$23.7 million from $26.4m in the year earlier period. Revenue declined by 7.5 per cent to $947.2m on the back of a low oil price environment that has tightened spending in the company’s primary Middle East and North Africa market.
Osama Bishai, chief executive of Orascom, said the company was continuing to expand its presence in its home market of Egypt, signing additional projects in power and roads. “Our significant involvement in all major segments of Egypt’s construction market further strengthens our position to key areas of focus such as transportation and water treatment,” he said.
The Nasdaq Dubai-listed company said consolidated new orders, excluding its company Besix, declined 83 per cent to $359.9m in the quarter compared to $2.22 billion a year earlier.
The company said it expects to take on a number of important projects during the second half of 2017 across Mena and U.S. markets. It said its backlog as of the end of June was impacted by 20 per cent due to the devaluation of the Egyptian pound.
Infrastructure and industrial work continue to account for the majority of the consolidated backlog, representing 86 per cent of total.