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Orascom reports $2bn first half 2017 revenue

Orascom Construction has reported a consolidated first half 2017 revenue of $2bn in line with the previous year. Consolidated net income attributable to shareholders increased 4.7 per cent year on year to $51.7 million in H1 2017 and decreased 10.2 per cent y-o-y to $23.7 million in Q2, 2017.

Consolidated net income attributable to shareholders increased 4.7% year-on-year to $51.7mn in H1 2017 and decreased 10.2% y-o-y to $23.7mn in Q2 2017 for Orascom.

The Middle East and North Africa (MENA) region accounted for 54% of total revenue, of which Egypt represented 91%, while Weitz and Contrack Watts comprised 28% of the total. Net income in H1 2017 in MENA reflects the improved performance in the second quarter while net income in the US was impacted by the realisation of a deferred tax asset of $20mn, the company said.

Net income contribution from Besix increased to $13.5mn in Q2 2017, bringing the total contribution in H1 2017 to $24mn compared to $9.5mn the previous year. The group’s net cash position stood at $202.1mn as of June 30, 2017, compared to $204.1mn as of December 31, 2016 and $186.8mn as of March 31, 2017. Total equity increased 26.2% to $381.6mn compared to the level at December 31.

Consolidated backlog excluding Besix stood at $4.7bn and new awards at $747.3mn as of June 30, 2017. The group expects to sign a number of important projects during the second half of 2017 across Mena and US markets, while the current backlog provides sufficient visibility on profitability, it said.

Backlog as of June 30, 2017 was impacted by approximately 20% due to the devaluation of the Egyptian pound. Infrastructure and industrial work continue to account for the majority of the consolidated backlog, representing 86% of the total.

Including the group’s 50% share in Besix, pro-forma backlog and new awards stood at $6.6bn and $1.5bn, respectively, as of June 30, 2017, the company said.

Orascom Construction CEO, Osama Bishai, said: “We continued to expand our presence in Egypt’s infrastructure sector during the second quarter and signed additional projects in power and roads as well as works associated with the new administrative capital. Our significant involvement in all major segments of Egypt’s construction market further strengthens our position in key areas of focus such as transportation and water treatment.

“In the US, we remain focused on executing our current projects while evaluating new opportunities. We are also pleased to report that Weitz has successfully completed ahead of schedule the largest student-housing complex in the US at Texas A&M University, solidifying its leadership in this growing sector of the construction market. Furthermore, we continue to execute our plan to streamline our US subsidiaries to improve our overall cost structure as we aim to grow this part of our business and increase profitability.”

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