Arabtec back in the black
UAE-based construction contractor Arabtec Holding has returned to profit for the first time in more than three years.
The group is undergoing a series of restructuring measures including the appointment of a strengthened executive management team.
While still in its infancy, the restructuring is already being complemented by improvements on the consolidated bottom line, attributable to equity holders of the parent, combined with growth in revenue.
Arabtec recorded net profit attributable to the parent of AED 18mn ($4.9mn) compared to a net loss of AED 46mn in 1Q16 while first quarter revenue rose by 11 percent to AED 2.2bn.
Group Chief Executive Officer, Hamish Tyrwhitt said: While this is another step towards the turnaround of the Group, there is still a lot more work to be done. This initial step reinforces our commitment to returning Arabtec to profitability and solidifies our strategic roadmap to achieving sustainability. The Recapitalisation Programme is laying the foundation to allow the Group to build on our three stage plan.
He added: To optimise the delivery of our AED 17 billion backlog, we are making key operational improvements through embedding enterprise risk management and a performance-driven culture, which is already evident in the increase of our gross profit margin. Resolving legacy claims and collecting receivables is a key action in Phase One which will be achieved through our ability to turn risk into opportunity.
Vital elements of Phase Two, Prepare, are already in progress, including maintaining a leaner organisation with SG&A at target benchmark level, already reflected in our Q1 numbers showing a 15% decrease. We are now well-positioned to address the remaining steps of Phase Two of our strategic plan, leaving us in a strong position to begin aligning our efforts towards key aspects of Phase Three. Collectively, these elements contribute to the successful and sustainable future for all our stakeholders as, together with our core values, we continue to work towards building the future of Arabtec, Mr. Tyrwhitt said.