Arkan strives to play a key role in Abu Dhabi Government diversification drive to deliver the 2030 vision.
Arkan posts 32 per cent growth in Profit to AED 81 million for the first 9 months of 2015
- Net profit margin increases 15% as compared to same period in 2014
- Groups’ financial performance driven by growth in sales and enhanced operational efficiencies
- Increased integration of business units further contribute to YTD financial performance
1 November 2015, Abu Dhabi, UAE – Arkan Building Materials Co. PJSC (ADX: ARKAN), a leading construction and building materials company in the UAE, announces a strong increase in revenue and profit for the first three quarters of FY 2015.
Arkan recorded revenues of AED 666 million for the first three quarters of 2015, an increase of over 20 per cent when compared to the AED 532 million recorded for the same period in 2014. The Abu Dhabi based Company’s profit for the first three quarters of 2015 was AED 81 million, representing growth of more than 32 per cent over the AED 55 million recorded for the corresponding period last year.
The large-scale integrated building products manufacturer also posted a rise in its net profit margin, which stood at 12.15 per cent for the first three quarters of 2015, a significant increase of nearly 15 per cent from the 10.35 per cent net profit margin recorded for the same period a year earlier.
The Company’s strong financial performance is attributed to a reinvigorated approach to business development and sales and to the achievement of greater efficiencies across its building materials manufacturing entities. Over the past year, the owner of the only integrated cement plants in Abu Dhabi had successfully implemented a number of initiatives aimed at diversifying its customer base and widening cross-selling opportunities.
Commenting on the Company’s financial results, Arkan Chairman Eng. Jamal Salem Al Dhaheri said, “Arkan’s financial and operational achievements over the year to date validate its sound strategy, as well as its management’s commitment to quality execution. As we look ahead, our goal is to remain at the forefront of the industry by continuing to work in close partnership with our customers and ensuring our products and services are aligned with their evolving needs. Our unique offering of diversified products and the strong reputation we have built in the marketplace positions us well for stable and sustainable growth well into the future as we continue to create value for our shareholders.”
Arkan is already a leading cement manufacturer in the UAE, and currently provides cement and other building and construction materials for a number of major infrastructure and development projects in Abu Dhabi, including the Abu Dhabi Presidential Palace, Abu Dhabi International Airport, Yas Island and Western Region.
The expansion of long-term contracts, many of which are large-scale infrastructure and community developments such as these, have contributed significantly to the Company’s sales growth over the past nine months. Sales volume growth has also had a knock-on effect of increased operational efficiency across Arkan’s plants, driving greater capacity utilisation and leading to a reduction in unit production costs, which also helped boost the Company’s bottom line.
“The double-digit revenue and profit growth reflects Arkan’s strong fundamentals, operational excellence and superior building materials offering that have enabled it to weather a general trend of increased volatility and price pressure in the sector,” said Abdellatif Sfaxi, Chief Executive Officer at Arkan. “It is also a reflection of our effort to set the benchmark for our industry, differentiating ourselves clearly from other market players through an expanding product portfolio, value-added services and a unique proposition that enables us to accompany our customer through the full life-cycle of their projects.”
2015 marks the first full year of operation for the Company’s Al Ain Cement Factory, one of the UAE’s largest, which came into operation in late 2014.
Other initiatives taken by the company include the development of export markets into the GCC and the Far East for specific product lines, as well as the expansion of its business relationships with customers to provide complimentary technical assistance, laboratory testing and advice on optimal material composition and specifications.
Arkan is also exploiting synergies across its product lines, including cement and clinker, blocks and pavers, dry mortars, GRP and PVC pipes and manholes, to further streamline its product and service offerings and to ensure it retains its pole position as the only integrated building materials manufacturer in Abu Dhabi.