UAE construction company Arabtec Holding has reported a net loss of AED774m ($210.7m) for the 2019 fiscal year.
It is the contractor’s first full-year loss since the 2016 fiscal year.
The loss was primarily driven by Arabtec’s construction business, which the Dubai-listed group said suffered due to tight liquidity conditions, a slowdown in project awards from the real estate sector, claim settlements and losses from investment in an associate company.
If the Covid-19 pandemic increases in magnitude and duration, the continuation of these circumstances could result in an even broader economic downturn, which could have a negative impact on the group’s financial results
Revenues declined to AED7.7bn in 2019 from AED9.8bn in 2018. Net margins reduced from 2.6 per cent in 2018 to -10.9 per cent in 2019.
Arabtec said it was redirecting its focus on the infrastructure and oil and gas sectors, and expects to hand over nine legacy construction projects by end-2020.
“If the Covid-19 pandemic increases in magnitude and duration, the continuation of these circumstances could result in an even broader economic downturn, which could have a negative impact on the group’s financial results,” the company told the Dubai bourse.
Arabtec’s announcement follows an AED437.4m net loss in the third quarter of 2019, with revenues declining to AED1.62bn at that time.
Senior management changes were also made at the group in April, with Wail Farsakh promoted from group chief operating officer to CEO during the month.
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