Middle East's biggest contractor expects $2.9bn of revenue in 2020 despite Covid-19 disruption
Exclusive: Family-owned Consolidated Contractors Company has secured several major infrastructure projects in the first quarter
The Middle East’s biggest contracting company, Consolidated Contractors Company, expects as much as $2.9 billion (Dh10.65bn) in revenue for the year despite a slowdown in the global economy due the Covid-19 outbreak.
That projection is higher than a previous forecast of $2.5bn and the company has already secured $500 million worth of new contracts this year, for major infrastructure schemes in Egypt, Qatar and Saudi Arabia, Samer Khoury, president of engineering and construction, said.
CCC, ranked as the 17th-biggest international contractor in the world by US trade title Engineering News Record, reaped about $4.2bn last year.
“If nothing stops, we’re going to hit $2.8bn-$2.9bn this year. Because we’ve picked up a few nice jobs,” he told The National.
“My only worry is maybe they will not start immediately. If they shift, we go back to $2.4bn-$2.5bn. But these are infrastructure jobs that they need,” he added, stating that in two of the three markets the company is already “up and running”.
“We have the awards, we have the advanced payments.”
The company is in the midst of a transition from being a family-led firm to three professional managers – Jamal Bahlawan, Hani Rayya and Yousef Ghantous.
“I was on a conference call one hour ago telling them what they need to focus on because now we are facing three things," Mr Khoury said on Tuesday.
"Existing jobs, like the metro in Riyadh, for example, they are limiting the hours we work. We have a big project with Chevron in Kazakhstan - they want us to demob one-third of the workforce to lessen the density and lower the risk. Some jobs in Egypt like El Alamein … because they have [coronavirus] cases in El Alamein City they shut down the whole project.”
The company is also facing a disruption to operations from Covid-19 outbreaks due to factors beyond its control. In Kuwait, for instance, the discovery of 10 cases on a neighbouring camp led to its workers also being quarantined for two weeks. “So our guys are stuck and can no longer go to work,” he said.
Although lower oil prices are of concern as it may cause clients to delay capital expenditure, Mr Khoury said the company’s scope of work means it is reasonably well protected from a downturn.
“I think there will be new capex, new projects, but the small jobs to maintain production ... will happen.
"For CCC, this has been a good chunk of our work. As we speak, we’re doing several jobs in Adnoc, several jobs in Aramco, several jobs in Qatar and in Oman,” Mr Khoury said.
“They will rationalise which ones are important but the ones directly related to upstream will happen because they need to increase capacity,” he said.
The company’s new operational structure is being finalised by the three new heads, with Mr Bahlawan heading operations, Mr Rayya running estimation, support and other back office functions and Mr Ghantous in charge of finance.
"I told them, it’s their organisation so they have to come up with it,” Mr Khoury said. He and other family members will now take a back seat, advising on strategy and providing support in terms of relationships with governments and lenders.
“I need a rest, to be honest, I’ve been on the road 100-200 days a year. I’m 60, I’d better start winding down,” said Mr Khoury.
CCC is an Athens-headquartered business that was founded by Mr Khoury's father Palestinian father Said Khoury, his brother-in-law Hasib Sabbagh and Kamel Abdul-Rahman in 1952. The company has over 100,000 employees under its management and operates in more than 40 countries.
Updated: April 1, 2020 06:51 PM