Dubai’s largest listed construction firm, Arabtec, posted a 47.26 percent drop in profit for Q2 2019 at 26.06 million dirhams ($7.09 million), compared to 49.41 million dirhams in the same period last year, as costs and expenses surged.
“2Q19 results marked the consecutive quarter of weakness in Arabtec’s profitability, dragged by a surge in selling, general and administrative expenses (SG&A) coupled by a decline in revenues,” Michel Said, a research analyst at Cairo-based CI Capital, told Zawya.
The company’s revenue dropped 8.6 percent to 2,185.79 million dirhams in Q2 2019, from 2,391.49 million dirhams in Q2 2018.
General and administrative expenses rose to 91.96 million dirhams compared to 78.84 million dirhams for the same quarter last year.
“2019 is shaping up to be even worse than 2018 for Arabtec, amid a clear slowdown in construction activity in the UAE, coupled with a management reshuffle,” Said added.
The company announced in a note accompanying its Q1 2019 results that its CEO Hamish Tyrwhitt, has stepped down from the firm and chief financial officer (CFO) Peter Pollard, was appointed as acting CEO. (Read more here)
Commenting on the Dubai builder’s results, group chief executive officer, Peter Pollard said: “During the first half of the year, we have secured new contracts in the industrial sector which we expect to continue given the strength of the pipeline.”
“With a particular focus on strengthening our balance sheet, we continue to reduce our debt by AED 373 million during H1 2019,” Pollard added.
(Reporting by Gerard Aoun; Editing by Seban Scaria)
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