(MENAFN- Khaleej Times) Drake & Scull International (DSI) has reported that net profit for the fiscal year 2014, ended December 31, was Dh110 million, with revenues at Dh4.83 billion.
DSI net profit hit by payment delaysEarnings per share (EPS) reached Dh0.047. Revenues recorded for the fiscal year were flat compared to last year and were primarily generated by the Saudi Arabia and UAE markets, each contributing 43 per cent and 26 per cent respectively.
The general contracting and engineering businesses generated 40 per cent and 51 per cent of the cumulative revenues achieved in fiscal 2014. The oil and gas division and waste water division maintained their yearly contribution to the top line by five per cent and three per cent respectively.
Profitability for the fiscal year was impacted by the delays in the KSA market in the general contracting sector and the UAE receivables provisions which affected the overall operating and net margins of the group.
The oil and gas business delivered solid margins and consistent results throughout the fiscal year, contributing 50 per cent of the consolidate bottom line in 2014.
DSI continued to increase its market share in the Mena region and won Dh5.34 billion worth of new projects across multiple sectors in fiscal 2014. The UAE market and particularly Dubai witnessed accelerated growth for DSI as total project awards in its home market reached Dh1.4 billion in fiscal 2014.
The order backlog reached a record high of Dh14.4 billion, representing a year-on-year increase of 20 per cent. Saudi Arabia and the UAE markets remain the largest contributors to the backlog, accounting for 34 per cent and 18 per cent respectively as of December 31, 2014.
Khaldoun Tabari, CEO of DSI, said: "The economic scenario in our region underwent a rapid change in the last few months which has had an impact on the regional construction industry. A cautious sentiment in the real estate sector has led developers to become more price conscious, which has lengthened the project development cycle in all our key markets. This has resulted in delays in our collections which created a slowdown in our revenue generation. The impact of this also affected our profitability margins."
"Reviewing our performance in 2014, we had a strong start in the first half of the year, with a lot of positive momentum in the form of multiple project awards in our region and especially the UAE. In the second half of the year, the entire region experienced unforeseen global economic challenges and uneven geopolitical developments that had a far reaching effect on the region's economy. From a corporate perspective, we experienced considerable delays in our operations, particularly in our biggest market KSA, which had a significant impression on our top line target for the year," Tabari added.
"We continue to see the KSA and the UAE as the main drivers of the region's economic development and expect to derive a large share of our business from these two markets. We also hope to see an upswing in Qatar's real estate as the World Cup preparations gather momentum, while we anticipate Kuwait to continue its current levels of investment," Tabari said.
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