Drake Q3 net profit falls 93pc; misses view
Dubai, November 18, 2012
Dubai's Drake & Scull International's third-quarter profit plunged 93 percent, widely missing analysts' forecasts as the contracting firm was hard hit by higher costs and falling contract revenue.
The company, which specialises in mechanical, engineering and plumbing operations, posted a third-quarter net profit of 3.9 million dirhams ($1.06 million), compared with a profit of 57.5 million dirhams during the same period in 2011, it said in a bourse statement on Sunday.
The quarterly profit missed the average forecast of six analysts polled by Reuters, who expected a profit of 40.6 million dirhams for the third-quarter.
Drake said contract revenue for the quarter was 622.8 million dirhams percent, a 26.5-percent drop from the 846.7 million dirhams revenue for the year-ago period.
Expenses rose to 81.5 million dirhams from 68.7 million dirhams a year ago, Drake said in the statement.
Drake has been gradually expanding its operations outside of Dubai following a slowdown in the emirate's once-booming real estate sector, last week announcing three contracts worth a total of $86.7 million in Abu Dhabi and Saudi Arabia.
The company last week also said it had signed a $120 million equivalent loan facility to support its growth into other markets. Goldman Sachs Inc acted as a coordinator for the loan facility.
Its shares have risen 5.3 percent year-to-date, underperforming the wider benchmark which has gained 19.5 percent during the same period. - Reuters