Arabtec losses continue, but Dubai contractor's financial performance improving

Contractor Arabtec has reported its sixth straight quarterly loss, despite an upturn in sales.

The company reported a Dh46.4m loss for the first three months of 2016, which was an 83 per cent reduction on the Dh279.8m loss the company declared in the same period a year ago.

Revenue increased by 8 per cent year-on-year to Dh1.94bn, according to newly-filed statements to the Dubai Financial Market.

The company still has a number of problems to contend with, though, including ongoing contractual disputes.

As revealed by The National in March, Arabtec has renewed its claim against Meydan for money it claims it is owed for work carried out on the construction of the Meydan racecourse.

Moreover, accounts reveal that a new dispute has emerged with a minority shareholder of its Qatar subsidiary. The shareholder has refused to sign off last year’s accounts, stating that it accepts “no responsibility for the financial position and performance of the subsidiary” during the year.

Arabtec’s statement said that it had obtained legal advice and “strongly believes that the non-controlling shareholder is responsible for their share” of the company’s operations, and any liabilities it incurs.

It also said that it believes the outcome of any dispute between the pair would not have any effect on its consolidated results.

A note accompanying the accounts filing states that following a board meeting held on Saturday, Arabtec’s directors intend to seek permission from shareholders to use some of its reserves “to extinguish part of its losses”. Its financial statements show that its accumulated losses currently stand at just over Dh2.27bn.

Last month, news agency Reuters reported that Arabtec has hired restructuring company AlixPartners to help strengthen its capital base.

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