Arabtec trims top line projection

Arabtec Holding expects a top line of Dh8 billion for 2009 against the projected figure of Dh9.5bn, it told Emirates Business in 2008 "due to Saudi markets not achieving expected results", according to its CFO.

"We were hoping in 2008 before the results [year end] were out that 2009 will be similar to 2008. But that projection was revised later in the year [2009] when we said that we don't expect more than Dh8bn or Dh8.5bn with a net margin of eight per cent. We were shy of a top line of Dh8bn but we expect the bottom line to be similar as we forecast," said Ziad Makhzoumi. "The top line has dropped because Saudi Arabia did not achieve as quickly the numbers that we expected."

The Okhta project in Russia is still on track though the main contract is not yet finalised, he added. He had earlier told this paper in 2009 that "by March or April 2010, when the permits are in place, the structure is finalised, the specifications are approved and the weather permitting, we will start work on the main construction".

The Okhta Centre is a complex, designed by the British architectural firm RMJM and is located on the eastern edge of Russia's former capital Petersberg. It will include a concert hall and museum in addition to the skyscraper, which will house the headquarters of Gazprom Neft, the oil arm of OAO Gazprom, the world's biggest natural-gas producer.

Meanwhile, the company's proposed merger with Aabar is still on track. "We are working on it," he added, but did not elaborate further on when the deal would be finalised. According to a Reuters report, the merger might see a possible deal closure in March. Aabar had agreed to acquire a 70 per cent stake in Arabtec last month in a deal valued at about $1.7bn (Dh6.23bn).

Arabtec announced yesterday that it has been awarded the contract to execute the construction work of the Yasmeen Rotana Hotel, owned by Al Fajr SA of Syria. Yasmeen Rotana is a five-star hotel valued at more than $120m with a construction value of about $67m. The project manager is Mace International, and the main consultant is Woods Bagot, which has been leading and collaborating with sub-Consultants such as BG & E and Red Engineering.

Meanwhile, a Zawya Dow Jones report stated that Arabtec Holding, the largest-listed builder in Dubai, expects a 2009 full-year net profit of about Dh640m, in line with its own expectations, but down sharply from Dh958m in 2008. Arabtec posted full-year revenue of Dh9.72bn in 2008.

Keep up with the latest business news from the region with the Emirates Business 24|7 daily newsletter. To subscribe to the newsletter, please click here.

Follow Emirates 24|7 on Google News.