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Emirates Steel Arkan recorded a net profit of 152.2 million UAE dirhams ($45 million) in the first quarter of 2023, an increase of 110 percent year on year compared to the AED 72.6 million ($20 million) for the same period in the 2022.
The combined business recorded quarterly revenue of AED 2.41 billion ($656 million) compared to AED 2.04 billion ($556 million) during the same period in 2022, an increase of 18 percent.
The statement attributed higher profitability to enhanced volumes and margins and sale of value-added products, bolstered by an upturn in construction activities and higher demand for residential developments in the UAE and the wider GCC region.
In an interview with CNBC Arabia, Al-Remeithi attributed the good results to exports of high added-value products to North America and North Africa, adding that the company currently exports 35 percent of its steel production to more than 70 countries.
The net profit from the steel division for the first three months of 2023 was AED 137.5 million ($37.5 million) compared to AED 61.1 million ($17 million) for the same period in 2022, an increase of 125 percent, according to the press statement.
The company expanded into three new markets for steel in the first quarter, exported Glass Fibre Reinforced Plastic (GRP) pipes to three projects in France and maintained its market share of steel in the UAE, the statement said.
Other highlights of the CEO’s interview with CNBC Arabia included:
- China's economy is slowing relatively and we expect raw material prices to fall in the near future
- Reduction of the level of debt by almost half compared to last year
- The company's cash flow level is currently equivalent to around AED 680 million
(Writing by Majda Muhsen; Editing by Anoop Menon)
