Arabtec's new contracts raise profit to Dh84.1m

Dubai: Arabtec Holding saw its first-quarter net profit more than triple year-on-year, the company said yesterday.

The Dubai-based builder, in which Abu Dhabi state-owned fund Aabar has a 10.5 per cent stake, made a net profit of Dh84.1 million in the three months to March 31, compared with Dh26.6 million in the corresponding period last year, exceeding analysts' forecasts.

Revenue for the quarter rose slightly to Dh1.3 billion from Dh1.2 billion in the previous year, Arabtec said in a statement to the Dubai Financial Market. The company also said it was considering buying out the remaining 45 per cent stake held by three separate partners in its subsidiary, Gulf Steel Industries (GSI).

"The board provisionally authorised the CEO of the company, Riad Kamal, to negotiate the best possible price for acquiring a further 45 per cent in GSI so long as it did not exceed the valuation originally obtained on the said subsidiary," Arabtec said in a separate statement.

In a separate development, Arabtec named Aabar's Khadem Al Qubaisi as chairman of the board; Qubaisi is also the chairman of Aabar.

Arabtec nominated four executives from Aabar to its board in April, a sign of the state fund's growing influence in the company after it doubled its stake to over 10 per cent. The company has also won a $60 million (Dh220.4 million) contract from Aabar after the stake hike.

Arabtec, along with a consortium of Turkey's TAV Insaat and Athens-based Consolidated Contractors Company (CCC), were identified earlier this week as the preferred bidders for an estimated $3 billion contract to expand Abu Dhabi International Airport.

The midfield terminal building will be around 700,000 square metres in size, according to the Abu Dhabi Airport Company's website.

Shares in Arabtec have more than doubled on the DFM so far this year on the back of new contract wins and expectations of further stake increases by Aabar.