Dubai’s Arabtec sees profit surge but no explanation

Arabtec Holding, the UAE’s largest construction company by market value, on Monday posted third quarter net profits of AED39.1m ($10.6m) up from AED6.8m a year earlier. The firm, which is increasingly looking to markets outside of Dubai in a bid to rebalance its portfolio of projects, said revenues for the three months were AED1.1bn, down from AED1.3bn a year earlier. The statement to Dubai bourse did not give a reason for the surge in net profit. Arabtec was among dozens of contractors that bore the brunt of Dubai’s property collapse in late-2008.  More than half of developments in the city were scrapped or put on hold in the wake of the financial crisis, leaving construction firms scrabbling for cash as project finance dried up. Arabtec in September said it had yet to receive 60 percent of the money it is owed for projects completed before the onset of the global financial crisis. The builder is owed a “substantial amount” by local developers, but expects all outstanding bills to be paid by the end-2012, CFO Ziad Makhzoumi, told Arabian Business. “There are two sets of payments, payments due from work we have completed now and payments due from work we completed before. “Close to 40 percent [of pre-recession bills] has been paid, and continues to be paid. So we hope that within a year or so, most of the outstanding payments will be up to date,” he said. The company currently has a backlog of projects worth around AED15bn ($4.08bn) in all of its markets by the end of the year. Arabtec said in June it would expand its Saudi workforce to 25,000 as it hopes to make the Gulf state its largest market. The company is also bidding for work in Qatar, as the tiny Gulf country prepares infrastructure for the soccer World Cup in 2022.