Arabtec, the Dubai builder hit hard by Dubai’s property crisis, said its net profit for the second-quarter dropped 40 percent, missing analysts forecasts.
Arabtec said on Monday it earned net profit of AED111.1 million ($30.25 million) in the three months to June 30, compared with a net profit of AED183.9 million in the year-ago period.
Profit for the first six months of the year fell 29 percent to AED245.6 million compared with a net profit of AED345.1 million in the same period of 2009.
Analysts had forecast average second quarter profit of AED148.3 million, according to a Reuters poll.
Arabtec is expanding overseas to diversify its portfolio away from Dubai’s once-booming property sector which has been hit hard by the global financial crisis as developers slow or cancel projects and jobs are slashed.
It is focussing on winning projects in new markets and has tendered for work in Turkmenistan, Azerbeijan and Angola.
Property prices in Dubai have been under pressure since late last year, when the financial crisis and a slump in oil prices ended a six-year economic boom in the Gulf region.
In July, UBS lowered its price target on Arabtec stock to AED1.70 from AED2.10, citing potential cash pressures at some of its Dubai customers and a highly selective market in Saudi Arabia.
The builder reported its first ever quarterly loss in the fourth-quarter after a charge of about $80 million for bad debts. (Reuters)
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