Saudi Arabia projects pay off for Drake

Drake & Scull's profit jumped nearly 70 per cent in the third quarter from the same period last year as it expanded in Saudi Arabia.

DSI won Dh3.6bn worth of contracts in the first nine months of the year. Rich-Joseph Facun / The National

Revenue from Saudi Arabian projects helped boost Drake & Scull International's (DSI) profit by 69 per cent in the third quarter.

The Dubai contractor posted profit of Dh57.5 million (US$15.6m) for the period, compared with Dh33.9m for the same period last year. Revenue for the quarter jumped 95 per cent, to Dh846m from Dh432m a year earlier.

The biggest boost was continued work on King Abdullah Petroleum Studies and Research Center in Riyadh, a 2 billion riyal (Dh1.95bn) contract with Saudi Aramco.

Saudi Arabia now accounts for more than 50 per cent of the DSI's Dh6.7bn backlog, with Abu Dhabi the second-largest market, said Zeina Tabari, the company's chief of corporate affairs.

DSI hopes to add its first projects in Algeria and India in the next few weeks, Ms Tabari said. "We believe we will be able to add Dh1 billion worth of work by the end of the year," she said.

Thanks in large part to the Saudi Aramco deal, DSI won Dh3.6bn worth of contracts in the first nine months of the year, more than the Dh2.7bn generated all of last year, Ms Tabari said.

The company posted Dh2.23bn in revenue for the first nine months of the year, surpassing the Dh1.85bn in revenue in total for last year. The company reported Dh1.23bn in revenue for the first nine months of last year.

Profit for the first nine months rose to Dh154.6m, compared with Dh119m last year.

Civil contracts played an increasingly important role in the revenue stream, as the company diversified away from its core mechanical, electrical and plumbing work.

Civil contracts generated Dh940m in the first nine months of the year, compared with Dh225m a year earlier.

But the totals were skewed to a degree by the Saudi contracts, where DSI is the civil contractor, Ms Tabari said.

Mechanical, electrical and plumbing work still generated Dh1.1bn of revenue in the first nine months of the year.

DSI's shares rose to 84 fils in trading yesterday, up from 82.6 fils.

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