Al Hassan Engineering sees profits rise 50%

This year the company has won contracts in the Abu Dhabi oil industry.

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Al Hassan Engineering Company, the Omani contractor, saw a rise in its net profits of more than 50% for the first half of 2010 compared to the same period last year following a rise in income from current projects.

Financial results for the EPC firm showed that net profits before tax reached OR1.535 million, up from OR1.01 million last year, with contract income rising 13% to OR24.9 million. After-tax profits increased from OR935,000 to OR1.03 million, up 10.7%, with operating profit rising more than 20% and net profit margin rising 2.38%.

“Improved performance on several projects” and a reduction in costs due to higher collection from customers on major projects were cited by the company as reasons for the profit increase. It follows the boost in project income as enjoyed by National Marine Dredging Company, whose net profits, including its operating profit, rose from AED188.9 million to AED288.2 million.

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Al Hassan specialises in civil and structural engineering for oil and gas, petrochemicals and utilities. Previous work includes installing the largest country’s gas and steam turbine combination power plant, state-of-the-art sub-station control system for the largest power transmission and distribution project -linking nine 132/33/11kV sub-stations - as well as projects in telecommunications and painting.

The company has won four major contracts in the region so far this year, including entrance into the Abu Dhabi oil and gas market by winning two contracts for a total value of OR10 million from Technip of France for civil and building works at Asab.

In Oman, the company won two contracts from Korea’s GS Engineering & Construction for temporary facilities, civil, building and overhead line works for the PDO Saih Nihayda Depletion Compression Project, an OR12 million combined deal. AHEC has also secured additional scope orders on existing contracts worth OR9.5 million.

It is also working on the Amal power plant project for PDO, the first EPC power plant project to be executed by an Omani company.

The company’s stock value has seen a huge rise since 25th August last year, rising from OR0.273 to reach a peak of OR0.498 by the first week of May. Ahmed Gad, an analyst at EFG Hermes in Dubai, nevertheless remained ‘neutral’ on the company on 26th May. Yesterday shares declined on the MSM 30 Index just over 0.4% to close at OR0.49.