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Abu Dhabi, UAETuesday 20 November 2018

Arabtec third-quarter net profit more than doubles

The Dubai builder continues to divest non-core assets

Revenue grew 12.7 per cent year-on-year to Dh7.2 billion during the period. Reuters
Revenue grew 12.7 per cent year-on-year to Dh7.2 billion during the period. Reuters

Arabtec Holding posted a 140 per cent year-on-year increase in third-quarter profit thanks to project wins as the Dubai contractor plans to continue to divest non-core assets.

Net profit attributable to equity holders rose to Dh181 million, the company said on Wednesday in a statement to the Dubai Financial Market, where its shares are traded.

Revenue grew 12.7 per cent year-on-year to Dh7.2 billion during the period.

“Moving towards 2019, the group continues to simplify the business through standardised processes and enabling tools and the removal of duplicated functions and activities through shared services and outsourcing,” said the company. “Arabtec continues to review non-core assets which are not considered key to the business for divestment or development.”

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The company had a backlog of Dh16.4bn at the end of September, including a Dh3.2bn award by Adnoc LNG to a consortium that includes Arabtec and a Dh155m contract from Dubai Municipality for sewerage and drainage infrastructure works.

“The Dh3.2bn award by Adnoc LNG to Target Engineering and Tecnicas Reunidas and further infrastructure work awarded to Arabtec Engineering Services highlights our progress in building a stronger presence in the infrastructure and industrial sectors,” said Hamish Tyrwhitt, Arabtec chief executive. “Both of these sectors offer a strong pipeline of addressable opportunities, which we are well-positioned to pursue.’

Arabtec has hired New York investment bank Moellis & Co to advise and assist the company in its debt restructuring and dealings with finance providers.

“Debtors days are continuing to decrease through our efforts to close out completed projects and shorten the payment cycle for current projects,” the chief executive said. “This has contributed to a further improvement in cash from operations and an Dh146m reduction in net debt. Strengthening the balance sheet remains a strategic priority going into 2019.”