{"id":5366,"date":"2016-02-21T15:42:10","date_gmt":"2016-02-21T08:42:10","guid":{"rendered":"http:\/\/www.siamlandbank.com\/propertynews\/property-news\/dubai-builder-arabtec-to-be-more-selective-in-taking-on-work\/"},"modified":"2016-02-21T22:02:06","modified_gmt":"2016-02-21T15:02:06","slug":"dubai-builder-arabtec-to-be-more-selective-in-taking-on-work","status":"publish","type":"post","link":"https:\/\/www.siamlandbank.com\/propertynews\/property-news\/dubai-builder-arabtec-to-be-more-selective-in-taking-on-work\/","title":{"rendered":"Dubai builder Arabtec to be more selective in taking on work"},"content":{"rendered":"


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\nUAE contractor Arabtec is adopting “a more selective approach to project tendering” after declaring a preliminary loss of Dh2.3 billion in 2015, which it blamed on a difficult regional construction market and a number of poorly performing projects.Saeed Al Mehairbi, the chief executive of Arabtec, said that the company will look to ensure “new projects deliver appropriate returns and, in turn, long term shareholder value” after declaring results which suggest a further quarterly loss at the end of 2015 and a full-year revenue decline of 12 per cent to Dh7.3bn compared to Dh8.3bn in 2014.
\nDetailed accounts will be published next month, but a comparison with the company’s third quarter accounts show that losses attributed to the shareholders of the parent reduced to about Dh404 million during the fourth quarter of 2015, which was a 57 per cent quarter-on-quarter drop compared with the Dh945m loss declared in three months to the end of September. As a result, its shares finished 8 per cent higher on the Dubai Financial Market on Sunday at Dh1.17 per share.
\nMr Al Merhaibi said that 2015 had been “a difficult year for all regional construction companies”, and that it maintaining a restructuring and cost reduction programme that has already seen many senior figures leave the business. The company, which is building the Louvre Abu Dhabi, is also taking a more aggressive approach towards getting paid for work it has already carried out. In its statement to the Dubai Financial Market, the company said: “Due to the backdrop, the group is even more focused on maintaining its working capital position and ensuring collection of its receivables. Accordingly, all of the group’s entities are vigorously seeking full recovery of receivables due and where necessary enforcing the group’s rights where payments are not made.”
\nSanyalak Manibhandhu, head of research at NBAD Securities, said that the loss declared by Arabtec was much higher than its expectations, but that revenues came in ahead of forecasts. He said that the boost in its share price was only likely to be temporary.Over the course of the year, the company’s net assets dropped by 46 per cent, standing at Dh3.19bn at the year end compared to Dh5.96bn at the end of 2014. “They’ve suffered losses for the past five quarters,” said Mr Manibhandhu. “If they are going to be a competitor in the marketplace in the upturn, they are going to need more capital.”
\nThe Burj Khalifa builder has previously tapped capital markets, raising Dh2.4bn in July 2013 through a rights issue.Last month, Arabtec won a Dh2 billion job from Aldar Properties for 1,017 villas on Yas Island. It is also helping to build the new international airport in Bahrain in a US$1.1bn deal. A new report published by management consultancy Strategy& said that the Middle East’s construction companies had experienced rapid growth over the past decade, driven by high oil prices and a fast-growing population. However, it said that they had been “caught by surprise” both by lower oil prices and geopolitical issues, and that they need to both reduce overheads and improve the quality of their management teams.
\nIssues that need to be addressed include a more effective management of manpower and better procurement of materials and services. A more rigorous approach to cash flow management is also required.”All too often, mismanaged cash flows leads to missed payments, at which point suppliers stop delivering products to job sites, work halts and projects get delayed,” the report said.mfahy@thenational.aeFollow The National’s Business section on Twitter
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\nSource : thenational.ae
\nRead more…Dubai builder Arabtec to be more selective in taking on work<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

UAE contractor Arabtec is adopting “a more selective approach to project tendering” after declaring...<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"false","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"spay_email":"","footnotes":"","jetpack_publicize_message":"","jetpack_is_tweetstorm":false,"jetpack_publicize_feature_enabled":true},"categories":[1],"tags":[],"class_list":["post-5366","post","type-post","status-publish","format-standard","hentry","category-property-news"],"jetpack_featured_media_url":"","jetpack_publicize_connections":[],"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p75ss1-1oy","jetpack-related-posts":[{"id":50666,"url":"https:\/\/www.siamlandbank.com\/propertynews\/property-news\/arabtec-shareholders-restructuring-vote-scheduled\/","url_meta":{"origin":5366,"position":0},"title":"Arabtec shareholders' restructuring vote scheduled","date":"April 2, 2017","format":false,"excerpt":"\r Shareholders in Arabtec are due to vote on its proposed capital restructuring at its annual general meeting, which is scheduled to be held on Tuesday, 18 April.The company has proposed a restructuring that will see it raise Dh1.5 million through the issue of 1.5 million new shares, initially taking\u2026","rel":"","context":"In "Property News"","img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":46151,"url":"https:\/\/www.siamlandbank.com\/propertynews\/property-news\/arabtec-unveils-three-step-recovery-plan\/","url_meta":{"origin":5366,"position":1},"title":"Arabtec unveils three-step recovery plan","date":"March 2, 2017","format":false,"excerpt":"\r Contractor Arabtec has said it intends to focus on \"core competencies\" in key Gulf markets as it looks to secure backing from investors for its latest turnaround plan.The company, which is currently seeking a further cash injection of Dh1.5 billion from investors as part of a new recapitalisation programme,\u2026","rel":"","context":"In "Property News"","img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":13138,"url":"https:\/\/www.siamlandbank.com\/propertynews\/property-news\/arabtec-looks-to-shore-up-balance-sheet-as-dubai-contractors-losses-narrow\/","url_meta":{"origin":5366,"position":2},"title":"Arabtec looks to shore up balance sheet as Dubai contractor's losses narrow","date":"May 15, 2016","format":false,"excerpt":"\r The contractor Arabtec has said that it is \"looking at ways to enhance its capital structure\" after posting its sixth successive quarterly loss on Sunday.The company said it \"is currently engaged in discussions with Aabar, its largest shareholder, in respect of potential options for cooperation and continues to remain\u2026","rel":"","context":"In "Property News"","img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":41690,"url":"https:\/\/www.siamlandbank.com\/propertynews\/property-news\/arabtec-adopts-new-risk-management-plan\/","url_meta":{"origin":5366,"position":3},"title":"Arabtec adopts new risk management plan","date":"January 24, 2017","format":false,"excerpt":"\r Arabtec has said that it is adopting a new risk management plan.In a statement to the Dubai Financial Market on Tuesday morning, the Arabtec chief executive Hamish Tyrwhitt said that the company had supported a new group-wide enterprise risk management plan at its board meeting on Monday.Arabtec shares were\u2026","rel":"","context":"In "Property News"","img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":8632,"url":"https:\/\/www.siamlandbank.com\/propertynews\/property-news\/arabtec-lands-dh1-7bn-housing-contract-in-fujairah\/","url_meta":{"origin":5366,"position":4},"title":"Arabtec lands Dh1.7bn housing contract in Fujairah","date":"March 21, 2016","format":false,"excerpt":"\r \r Arabtec has won a Dh1.7 billion contract to build 1,100 houses for Emiratis in Fujairah.The UAE government's Ministry of Presidential Affairs awarded the contract for the homes that will be built on a 2.15 square kilometre plot at Mohammed bin Zayed City.Work is due to start immi\u00adnently and\u2026","rel":"","context":"In "Property News"","img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":41682,"url":"https:\/\/www.siamlandbank.com\/propertynews\/property-news\/arabtec-adopts-new-risk-management-plan-in-bid-to-cut-costs\/","url_meta":{"origin":5366,"position":5},"title":"Arabtec adopts new risk management plan in bid to cut costs","date":"January 24, 2017","format":false,"excerpt":"\r Arabtec has said that it is adopting a new risk management plan as the company continues to cut costs in the wake of a major restructure.In a statement to the Dubai Financial Market on Tuesday morning, the Arabtec chief executive Hamish Tyrwhitt said that the company had supported a\u2026","rel":"","context":"In "Property 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