Depa Limited issued the following trading update for the Q3 ended September 30th 2011.
During the Q3, Depa has seen a significant pick up in business with projects which had been delayed, especially in the MENA region now being signed into backlog. The Company signed AED 1.6 billion of new contracts boosting its backlog by 70% to a record high of AED 3.9 billion from AED 2.3 billion as of June 30th 2011. Whilst this stream of new business vindicates Depa's diversification strategy in recent years it will take time to flow through to revenue and profits. This means that 2011 financials will remain close to forecast which was revised at the half year stage with increased income coming through in 2012's numbers.
The AED 929 million contract Depa's largest contract ever signed is for the complete fit out of the 27 lounges at Doha's new international airport. Lindner Depa, the Company's JV which specializes in infrastructure projects will undertake the one year contract with immediate effect.
Mr Mohannad Sweid CEO of Depa said that "We are encouraged by the amount and diversity of new business signed during the quarter, a direct reward for pursuing our core strategy of diversification combined with more stringent project selection. Despite European economic concerns and political uncertainty across many Arab countries, government spending, especially in the Gulf, continues to drive our backlog to its highest level ever and favorably positions the Company for the coming months giving us strong visibility on future revenue."
Mr Nadim Akhrass MD operations of Depa said that "This very significant contract; the largest we have ever won, is in line with our strategy of increasing the proportion of revenue from major government funded infrastructure projects. Our deal momentum in this sector has been strong and follows on from our recent AED 109 million contract for interior work at the new international terminal at Mumbai International Airport. This new contract also comes hard on the heels of the AED 375 million project we recently announced for work on the architectural finishes at the King Abdullah Petroleum Studies & Research Centre in Riyadh, Saudi Arabia."
