Wednesday, Aug 15, 2012
Dubai: Drake & Scull International’s (DSI) second-quarter net profit tumbled 41.81 per cent to Dh32 million compared to Dh55 million during the same period last year as work on some international projects slowed down.
Net income attributable to owners of the parent dropped to Dh26 million from Dh51.3 million a year earlier, the company said in a statement.
“Lower productivity on major projects and especially in Saudi Arabia contributed to the decrease in revenues,” said Osama Hamdan, DSI’s chief financial officer,
Revenue in the second quarter dropped to Dh717.3 million when compared to Dh738.7 million in the same period a year earlier.
“Finance cost from acquisition funding and contracts provisioning continue to hinder profit growth. Our exposure to the euro currency through our German subsidiary and the volatile fluctuation in foreign exchange also contributed to the decline in earnings,” Hamdan said.
Earnings per share stood at Dh0.012 compared to Dh0.024 recorded during the same period last year.
Project awards for the quarter reached Dh646 million secured in Abu Dhabi, Dubai and Oman while projects for the year to date secured contracts reached Dh1.6 billion.
The company managed to sustain its order backlog at Dh7.4 billion recorded as of the June.
Hettish Karmani, Senior Financial Analyst, Global Investment House, said, DSI’s exposure to the euro currency through its German subsidiary and volatile foreign exchange markets contributed to the decline in earnings.
The company reported total revenues of Dh1.494 billion and net profits of Dh75 million for the first half of this year.
The firm said it is expanding into rail and oil & gas and both business units are expected to contribute to the revenue in the second half of the year.
DSI reported total revenues of Dh1.49 billion and net profits of Dh75 million for the first half of 2012.
“The gross margins are expected to improve after all directs expenses related to the establishment of news offices in Iraq, India and Algeria are completely rendered and incurred,” he said.
DSI shares last traded down 1.94 per cent at Dh0.910.
By Naushad K.Cherrayil Staff Reporter
Gulf News 2012. All rights reserved.
