British engineering consultancy WS Atkins has recovered £8m
($12.9m) in outstanding debts from clients in the Middle East, its regional
managing director said.
The debt recovery, which included payment of outstanding
fees from government and semi-government firms, helped the company to a 70
percent rise in regional full-year profit.
“This year we have recovered £8m worth of debt in the
Middle East,” said Richard Barrett, managing director, Middle East. “This
includes debt recovered from our property sector clients and debt recovered
from some government bodies.
“In the past, most of our business has been in the UAE
and so most of our debt recovery has come from within the UAE. But we have also
seen debt recovery from [other] parts of the region.”
Atkins was one of hundreds of construction firms that faced writedowns
and delayed payments from developers following the collapse of Dubai’s property
bubble in late-2008.
More than half of developments in the emirate were cancelled
or put on hold as project financing dried up and real estate speculators fled the
market.
Nakheel, the real estate arm of state-owned Dubai World, was
among the emirate’s largest defaulters after racking up billions of dirhams in
unpaid fees to trade companies.
Atkins, along with international rivals Halcrow, EC Harris,
Hyder, Mouchel and WSP, were among many firms awaiting payment at the beginning
of this year.
UAE-based Al Habtoor Leighton in April was forced to raise
$800m from its parent company to offset the impact of $1.1m in delayed payments
and safeguard its future projects in the Gulf.
In May, state-backed property group Nakheel said it would
pay trade creditors $1.3bn in the form of Islamic bonds by the end of June, in
an effort to settle 60 percent of its debt.
The global boss of Atkins Keith Clarke said in April he
expected to receive payment in sukuk from debt-laden Nakheel in the next few
months.
Atkins last week reported total underlying pre-tax profit
for the year to end March of £102.7m against £93.9m in 2010. Profit for its
Middle East unit reached £23m.
Barrett said the
firm planned to increase its headcount in the region this year, chiefly in
Saudi Arabia and Qatar, to accelerate its expansion in those markets.
The company lost 16.5 percent of its Middle East staff in
2010 to 1,555 employees as the collapse of Dubai’s property market hurt its
largest regional revenue source.
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