Worker costs dent Al Khodari profits
Al Khobar-based firm witnesses huge hike in 2013 contract wins
Saudi Arabian contractor Abdullah AM Al Khodari & Sons has reported that its profits more than halved in 2013 to $17.2mn (SR64.3mn).
The company blamed the decrease on higher costs, which rose by around 15%, and a fall in non-core income.
Saudisation issues were partly to blame, it said, as the $640 (SR2400) levy per non-Saudi worker employed above a certain ratio adding $6.9mn (SR26mn) to its annual work permits bill (an annual increase of 815%).
It also said that the number of visas issued for workers was far lower than those which the company needed, meaning that it had to take on temporary labour at double the rates that the company pays its own staff. This led to a $10.1mn (SR38mn) rise in temporary staff costs.
On a brighter note, the company, which mainly carries out work for government clients, saw its pipeline of new projects almost trebled during the year.
It secured contracts worth around $720mn (SR2.7bn) - up from $253mn (SR950mn) in 2012. This brought its total backlog up to $980mn ($3.7bn).