Tuesday, May 10, 2022

After merger, Abu Dhabi's Emirates Steel Arkan delivers Dh2.04b in Q1-2022 revenues

 


UAE's biggest building materials company is reaping post-merger gains

Dubai: Abu Dhabi’s Emirates Steel Arkan – the biggest listed building materials company in the UAE – generated revenues of Dh2.04 billion in the first three months of 2022 against Dh233.5 million a year ago. The gains were led by a combination of factors, notably the merger that was completed late last year with Arkan Building Materials.

Plus, there is also the firming up in building commodity prices. Net profit has shot up to Dh72.6 million from Dh1.2 million. “The foresight of the merger of Emirates Steel and Arkan and the impact of the management changes we made are clearly evident in the strong financial metrics that the merged entity has delivered in the first quarter,” said Hamad Abdulla Mohamed AlShorafa Alhammadi, Chairman. “The Group’s management has made great strides in enhancing efficiency and unlocking the full potential of the combined entity.”

On a stand-alone basis, Emirates Steel had a net profit of Dh61.1 million, which itself is a a 265 per cent increase on Q1-21, through ‘higher exports of rebar, sections and sheet piles to regions including Asia and North America’.

Organisational fix

In the first quarter, the company ran a programme to enhance the organisational structure of the group to ‘accelerate the integration, find new synergies and bring about greater efficiencies’.

It appointed the global sustainability advisory firm, ENGIE Impact, to assess Emirates Steel Arkan’s footprint and create a detailed road map to accelerate the ‘Carbon Net Zero’ transition. In the coming quarters, Emirates Steel will also begin marketing ES600, a new light-weight ultra-high-strength rebar, designed to allow its construction customers to build more with less raw materials, thereby reducing the carbon footprint of construction projects.

"Despite an increase in geopolitical tensions, the outlook for the second quarter is favourable and the efforts we have made to improve the performance of our business units will continue to provide opportunities for further growth," said Saeed Ghumran Alremeithi, Group CEO.

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