Investor and Media Centre

Depa Limited: Interim Results 2009 - Net Profits up 65%

Aug 26 ,2009

Depa Limited (ticker DEPA) (“DEPA” or “the Company”), the world’s largest interior contractor today reports results for the six months ended 30 June 2009.

Highlights

Financial performance

§         Net profit after minority interests up 65% at AED 91.7m (H1 2008: AED 55.6m) driven by significant contract wins and robust financial performance.

§         Contract income up 49% at AED 1,107.6m (H1 2008: AED 741.1m) .

§         Profit margin increased to 8.3% (H1 2008: 7.5%) after minority interest.

§         On target to achieve approximately 30% revenue and profit growth for full year 2009.
 

Backlog / LOUs

§         Current backlog now stands at a total of 190 projects.

§         Backlog reached AED 2.6bn (H1 2008: AED 2.5bn).

§         No client or contract accounts for more than 8% of the current backlog.

§         Backlog consists entirely of projects that are already at the advanced construction stage. Being at the end of the development chain, Depa typically moves on site to finish the building for occupation and hence, at a stage where the project is extremely unlikely to be cancelled.
 

Diversification strategy

§         In line with its strategy, Depa continues to diversify revenues by adding market niches and geographies to reduce reliance on Dubai and the hospitality sector. Increasing focus on countercyclical industries such as infrastructure.

o        Huge growth in infrastructure with Lindner Depa’s net profit up to AED 35.6m (H1 2008: AED 1.5m) and revenues reaching AED 212.8m (H1 2008: AED 23.2m). Depa is on track to complete fit out works for Dubai Metro’s red line stations.

o        Singapore: moved into profit with net profit reaching AED 4.4m and revenues reached AED 54.3m

o        Abu Dhabi: significant increase in net profits to AED 16.2m (H1 2008: AED 0.2m). Revenues reached AED 97.0m (H1 2008: AED 21.0m)

o        Saudi Arabia: moved into profit with net profit reaching AED 3.7m (H1 2008: loss of AED 0.4m) and revenues of AED 20.2m (H1 2008: AED 4.8m)

§         Since period end, Depa entered another new market; Angola, through an initial AED 9.2m contract  

Reducing seasonality

§         Traditionally, interior contracting is a highly seasonal business with a substantial portion of contract income being recognised in the second half of the year as the end of the fiscal year is usually used as contract deadline by clients. In line with its previously stated aim, Depa has successfully reduced this cyclicality realising 43% of revenues in the first half of 2009 compared to 37% in the same period last year and 31% vs. 25% of profits respectively.
 

Commenting on the results Mr Mohannad Sweid, CEO of Depa, said:

“Depa’s strong performance in terms of revenue and profit growth is driven by prestigious contract wins across target markets and our backlog has increased significantly compared to the same period last year. We have been highly successful in reducing the seasonality of the business as we promised by securing early payments to safeguard our revenue streams. We continue to diversify revenues away from Dubai and the hospitality sector and focus on infrastructure which is countercyclical. Depa is very much on track to reach its target of approximately 30% profit and revenue growth for the full year.”

 

The full set of Interim Results can be found on Depa’s website: www.depa.com

 

-Ends-

 

Enquiries:

Depa Ltd                                                                                             +971 4 224 3800

Noor Sweid, Managing Director, Strategy

 

BrunswickGulf Ltd                                                                              +971 4 365 8260

Edward Moore / Said Elbanna

 

About Depa Limited:

Depa Limited is the largest interior contractor in the world. Operating principally in the luxury fit-out industry, its main areas of business cover hospitality, high-end residential properties, retail outlets, yachts, as well as public sector amenities such as airports, hospitals and transport systems. Depa is listed on the Dubai International Financial Exchange (ticker DEPA) and has Global Depositary Receipts on the regulated market for listed securities of the London Stock Exchange plc (ticker DEPA and DEPS).

The range of business activities performed by Depa comprises:

·         Interior contracting : which focuses on luxury interior fit-out services, which include installation and finishing of floors, walls, ceilings and fixed joinery;

·         Manufacturing : which comprises a network of factories and joineries which produce customised furniture, fixtures and equipment (FF&E) for Depa itself and the wider market;

·         Procurement : which involves the procurement of supplies and materials from third parties to support and complement Depa's interior contracting and manufacturing operations as well as third party procurement contracts for specific FF&E projects.

 

By integrating these services into a single package, Depa provides clients with comprehensive and customised interior contracting solutions.

With more than 8,000 employees worldwide, the company operates through an integrated network of subsidiaries, affiliates and representative offices located in the UAE, Saudi Arabia, Qatar, Egypt, Jordan, Syria, Libya, Morocco, India, Malaysia, Thailand, China, Singapore, UK, the Netherlands, and the United States. Through this network, Depa has successfully executed large and complex projects in over 16 countries including the Burj Al Arab Hotel (Dubai), Emirates Palace (Abu Dhabi), the Museum of Islamic Art (Doha), Four Seasons Hotels (Sharm El Sheikh & Mumbai) and Atlantis Resort (Marrakesh).

CONTACT US

Depa Group, Vision Tower,
35th Floor, P.O. Box 56338,
Dubai, U.A.E.
T: +9714-446-2100
F: +9714-446-2102
info@depa.com

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