Stock News: Arabtec Drags Down Dubai With Poor Q3 Results

Construction firm Arabtec Holding dragged down Dubai in early trade on Sunday after posting disappointing third-quarter results, while markets in Abu Dhabi and Qatar edged up.

Dubai’s index slipped 0.3 per cent as Arabtec dropped 2.8 per cent and was one of the most heavily traded stocks on the bourse.

Arabtec reported a 32 per cent drop in third-quarter net profit to Dhs68.7 million ($18.7 million) in the three months to Sept. 30.

Analysts at Global Investment House and SICO Bahrain had forecast it would make a quarterly profit of Dhs113 million and Dhs139.9 million respectively. The firm’s quarterly revenue was Dhs2.4 billion, up from Dhs1.94 billion a year earlier, but general and administrative expenses rose 89 per cent to Dhs241.6 million over the same period.

Arabtec shares climbed 11.5 per cent last week as Abu Dhabi state fund Aabar Investments raised its stake in the firm to 34.9 per cent by buying shares held by former chief executive Hassan Ismaik, who abruptly resigned in June after differences of opinion with Aabar.

Shares in another Dubai contractor, Drake and Scull, fell 0.9 per cent after it reported a 10 per cent drop in third-quarter profit on Sunday, although analysts polled by Reuters had expected a steeper decline.

The company made a net profit of Dhs21.4 million in the quarter, while analysts had on average forecast it would earn Dhs16.1 million.

Abu Dhabi’s index added 0.4 per cent as telecommunications firm Etisalat rose just as much.

Qatar’s benchmark rose 0.7 per cent, largely on the back of conglomerate Industries Qatar, which was up 1.4 per cent to 197.50 riyals. It faces major technical resistance at 198.00-202.90 riyals, this year’s peaks, and it is not clear that the barrier will break in the near term given modest turnover in recent days.