Construction companies on the MEED 100 list experienced mixed fortunes during the past year.
The UAE’s construction sector has continued to suffer with the economic downturn sapping demand for property and construction materials. Billions of dollars worth of projects remain cancelled or on hold as access to capital is still tight and investor sentiment weak. Inevitably, this has impacted on companies’ performance.
|Rank 2010||Rank 2009||Company||Exchange||Market Cap ($m)||Share price ($)|
|19||39||Orascom Construction Industries||Egypt||9,127||975|
|72||83||Southern Province Cement Company||Tadawul||2,660||19.00|
|Source: Thomson Reuters|
Last year’s new entrant at 40, Abu Dhabi-based Arkan Building Materials Company has dropped out of the list. The firm, in which Abu Dhabi government has a 51 per cent stake, was set up in 2005 to capitalise on the Gulf’s construction boom. Its assets include the Emirates Cement Factory and the Emirates Concrete Blocks Factory, along with a joint venture scaffolding company, Arkan Urbina.
Casablanca’s Lafarge Ciments has also moved down the rankings, from 53 in 2009 to 57 this year. According to MEED Projects, the firm has four projects planned – two in Iraq, one in Syria and Morocco each, valued at $2.15bn in total. Only the Aleppo Cement Plant in Syria is at the execution stage.
The construction sector in Saudi Arabia has fared much better because the government has kept the economy moving by increasing its capital spending commitments and has invested heavily in infrastructure projects.
Southern Province Cement Company, a new entry last year at 83 has climbed nine places to 72 this year with a market capitalisation of $2.7bn. The slowdown has impacted on cement sales, however, and the company has said its net profit in 2009 would be down 7.8 per cent than 2008. It says preliminary results show net profit would be SR729m ($194m) down from SR791m a year earlier.
Egypt’s Orascom Construction has turned around its fortunes since dropping 30 places last year. In 2010, it has climbed 20 places to 19, with a market capitalisation of $9.3bn.
Orascom is organised into two business divisions: construction and fertilisers. The construction group comprises two wholly owned businesses – Orascom Construction and Contrack International – and a 50 per cent stake in Belgium’s Besix Group. The company is focused on developing its fertiliser business.
The firm aims to become a leading fertiliser producer and expects to rank among the top 10 nitrogen-based fertiliser manufacturers in the world by 2010.