Contractor posts profit of US$12.5m as projects in Saudi gain momentum
Contractor Drake & Scull International reported a higher fourth-quarter profit on Thursday as the firm's projects in Saudi Arabia gained momentum.
Drake, in which Goldman Sachs bought warrants worth US$40m, reported a fourth-quarter net profit of AED46m (US$12.5m), the company said in a statement on Dubai's bourse.
This compares to a net profit of AED42m reported during the same period in 2011, a spokesman told Reuters after the announcement.
The earnings beat estimates of four analysts who forecast an average quarterly net profit of AED17.5m.
Revenue for the quarter was AED1.2bn.
Drake, which specialises in mechanical, engineering and plumbing (MEP) operations, has been gradually expanding its operations outside of Dubai following a slowdown in the emirate's once-booming real estate sector.
The company attributed its fourth quarter growth to construction progress in its civil projects across Saudi, one of the contractor's key markets.
Drake's joint venture with Arabian Construction Company won a new US$720m contract in Saudi Arabia in December, one among a series of contract wins last year in the kingdom.
"We expect substantial announcements in Q1 for the civil and MEP businesses in our primary markets and particularly in Saudi Arabia and Qatar," Chief Financial Officer Osama Hamdan said in the statement.
Goldman Sachs bought warrants worth AED147m (US$40m) in Drake less than a week after helping arrange a loan facility for the contracting firm.
Drake said its total order backlog reached AED9.1bn, representing a year-on-year increase of 30 percent.