Despite the construction slowdown Arkan Building Materials had a net profit of Dh19.2m for the first quarter compared with a loss of Dh91m for the same period last year. Mr Kumar expects the company’s second-quarter results to be in line with the first quarter, at best.
The Dh91m first-quarter loss last year was attributable to the performance of Arkan’s investment portfolio – which consisted of stocks in the UAE markets and property – when the global downturn occurred. The company trimmed its debt in the first quarter of this year by six per cent to Dh790.1m, from Dh840m last year.
As demand for new homes and, by extension, building materials declines, other companies in the sector are expected to be hit. “Although results were better than last year, we continue to have a negative stance on the company and the UAE cement sector,” Mr Kumar said.