UAE's largest construction firm by market value made a net profit of $22.90m
Arabtec Holding, the United Arab Emirates largest construction firm by market value, more than tripled its first-quarter net profits, exceeding analysts' forecasts, and said on Wednesday it was considering buying out its steel subsidiary.
The company, in which Abu Dhabi state-owned fund Aabar has a 10.5 percent stake, made a net profit of 84.1 million dirhams ($22.90 million) in the quarter, compared with 26.6 million dirhams in the corresponding period last year.
Revenue for the quarter rose slightly to 1.3 billion dirhams from 1.2 billion dirhams in the previous year, Arabtec said in a bourse statement on Wednesday.
Arabtec's quarterly profit easily beat estimates of four analysts polled by Reuters, who on average expected it to earn 40 million dirhams in the quarter.
The company also said it was considering buying out the remaining 45-percent stake held by three separate partners in its subsidiary, Gulf Steel Industries (GSI).
"The board provisionally authorised the CEO of the company, Riad Kamal, to negotiate the best possible price for acquiring a further 45 percent in GSI so long as it did not exceed the valuation originally obtained on the said subsidiary," Arabtec said in a separate statement.
It also named Aabar's Khadem Al Qubaisi as chairman of the board. Qubaisi is also the chairman of Aabar.
Arabtec nominated four executives from Aabar to its board in April, a sign of the state fund's growing influence in the company after it doubled its stake to over 10 percent.
The company has also won a $60 million contract from Aabar after the stake hike.
Arabtec, along with a consortium of Turkey's TAV Insaat and Athens-based Consolidated Contractors Company (CCC), were also identified as the preferred bidders for an estimated $3 billion contract to expand Abu Dhabi's international airport.
Shares in Arabtec have more than doubled on the Dubai bourse so far in 2012 on the back of new contract wins and expectations of further stake increases by Aabar.