(MENAFN- Khaleej Times) Arabtec Holding on Thursday declared a 114 per cent surge in its first-half net profit compared to same period last year.
Dubai's largest contractor swung to a profit in the June quarter, beating analysts' forecasts, on the back of business growth in the home market and Saudi Arabia.
The construction firm reported a net profit of Dh155 million for the January-to-June period. The company, partly-owned by Abu Dhabi state fund Aabar Investments, reported a Dh92.4 million net profit for the second quarter, compared to a loss of Dh11.6 million during the same period in 2012.
Arabtec's earnings beat average estimates of five analysts polled by Reuters who expected a quarterly profit of Dh51.5 million. The company declared Dh1.6 billion revenues for the quarter over Dh1.3 billion in the prior-year period.
"Our businesses have delivered a strong performance in the first half of 2013, particularly in the UAE and in Saudi Arabia, and our results are a clear indicator of the health of the industry and the potential for sustained growth in the medium term," Hasan Abdullah Ismaik, managing director and chief executive officer of Arabtec Holding, said in a statement.
Arabtec has maintained double-digit gross margins with 12 per cent in the first half of 2013 and 11 per cent in the second quarter. The stable double-digit margins reflect a return to growth in the construction industry in the Middle East, as the region emerges strongly from the global financial crisis.
The continuing strong performance of the company's operations in the UAE and in Saudi Arabia, as well as the realignment of Arabtec's businesses, have contributed significantly to the company's enhanced financial performance in the first half of 2013, according to the company.
"All these positive developments are precursors to a strong performance in 2013 and beyond, which will start to show enhanced returns from 2014 onward since profits are tied to progress of work," Ismaik said.
The Dubai builder, which is behind Abu Dhabi's edition of the French Louvre museum, disclosed that its backlog has also increased by a net sum of Dh7.3 billion to Dh24.4 billion due to an increase in new project awards and expansion during the first half of the year.
"We expect that this substantial backlog will have significant positive impact on the company's financial position and profitability during the next five-year period as well as in the long term," Ismaik said.
"Our focus now is on refining our project management organisation and execution platform in order to help deliver more value and stronger results for our clients and stakeholders."
Arabtec's stock price fell by 2.8 per cent on the Dubai Financial Market on Thursday ahead of the results. The share price has risen 34.4 per cent year-to-date.
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