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Drake & Scull posts 47% Q1 profit rise

on May 2, 2013

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Contractor Drake & Scull has announced a 47% increase in net profit for the first quarter of 2013 of $17.2m (AED: 63m).

The company said that the higher year-on-year quarterly profit was achieved on the back of a 58% jump in revenues during the same period to $334m (AED: 1.2bn).

It also said that its cashflow had "substantially improved" - buoyed by around $550m (AED: 2bn) worth of projects won during the year to date, which has helped to push its backlog up by 17% over the 12-month period to $2.45bn (AED: 9bn).

CEO Khaldoun Tabari said: “We continued to deliver consistent revenue growth and improved profitability in this quarter. KSA and the UAE contributed 59% and 1 % to the consolidated top line growth across all our business streams and remain our key markets for 2013.

“We are well geared to deliver on our AED 9 billion backlog and our priority remains in delivering improved margins and enhanced liquidity,” he added.

CFO Osama Hamdan said the firm had managed to boost margins considerably - particularly in its core MEP business which generated 46% of total revenues and margins of 7.5%.

"The general contracting business also contributed 51% of the quarterly revenues at a steady net margin of approximately 6 %," he added. "Remarkably, the oil & gas business achieved 15% in net margin, with higher contribution to the consolidated quarterly revenues."

He also added that the firm was "keen on improving operational liquidity to deliver on our backlog”, and said that he expected the momentum which began in the first quarter to continue throughout Q2.