Abu Dhabi: Arabtec Holding, the Dubai-listed construction company, said on Thursday it has agreed to a Dh400 million debt facility that will be provided by Aabar, a major shareholder of Arabtec.
“With the challenging conditions continuing in the regional construction market, this facility will provide Arabtec will additional funding to be directly deployed towards delivering our ongoing and newly-awarded projects in a timely manner,” Saeed Al Mehairbi, acting chief executive officer of Arabtec, stated.
The announcement, which was posted to the Dubai Financial Market where Arabtec is listed, comes as part of efforts to strengthen financial performance as the company aims to break even this year.
It has already pulled out Dh1 billion out of its statutory reserve to extinguish losses after getting shareholder approval to do so in June. The Dh1 billion will extinguish 44 per cent of the losses accumulated thus far, and leave just Dh148 million in Arabtec’s statutory reserve.
The company reported Dh46.4 million in net losses for the first quarter of 2016, and earlier reported Dh2.3 billion in net loss for the full-year 2015.
Arabtec had been attributing its losses to challenges in a market where profit margins are getting lower and payment cycles are getting longer. Its
share price ended flat on Thursday at Dh1.5.
