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DSI reports $9m net profit in H1 2015

Operations in the UAE picked up momentum and contributed 28% of the group revenue; up by 7% as compared to the same period in 2014, followed by operations in Qatar

Khaldoun Tabari, CEO and vice chairman of DSI.
Khaldoun Tabari, CEO and vice chairman of DSI.

Contracting firm Drake & Scull International reported a net profit of $9.2m (AED34m) for the first half of 2015 ended 30 June, 2015.

Total revenue for the company achieved a 2% y-o-y growth to $626m (AED2.3bn) in H1 2015, according to the bourse filing by the company.

The statement said that 37 % of the consolidated group revenue was generated in KSA which remains the largest market for DSI in H1 2015.

Operations in the UAE picked up momentum and contributed 28% of the group revenue; up by 7% as compared to the same period in 2014, followed by operations in Qatar contributing 16% of the group revenue for the period.

Revenue from the engineering business reached a high contributing 60% of the group revenue, up 11% as compared to the same period in 2014.

The general contracting business contributed 35% of the group revenue, down by 8% as compared to the same period last year. Operating profit for H1 2015 was $15.7m (AED58m) down by 27% as compared to the same period in 2014 owing to delays and cost overruns on projects across several markets.

Total new project awards for the first half of the year reached $381m (AED1.4bn) taking the group backlog value to $3.5bn (AED13.2bn) as of June 30th 2015.

The UAE comprised the largest share of the new awards accounting for 75% of the group awards and Oman comprised 25% in H1 2015. The majority of the new awards were secured in the hospitality sector which accounted for 58% of the group awards while the commercial and residential sectors stood at 24% and 18% respectively.

Commenting on the results, Khaldoun Tabari, CEO and vice chairman of DSI said, “We have met our top line target for the first half of the year; however, we continue to face pressure on our margins as a result of the delays on several projects. Despite the bearish business sentiment across the sector, we’ve started Q3 2015 on a positive
note with $83m (AED305m) worth of new projects in Kuwait and we remain focused on improving our operation efficiency and increased focus on collections across all markets.”

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