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Q1 Financial Results

Thursday, May 12, 2011

National Central Cooling Company PJSC (‘Tabreed’), the Abu Dhabi-based utility company, released its first quarter consolidated financial results today.  These results, the first to be announced since the successful completion of Tabreed’s recapitalization program on 1st April 2011, demonstrate the Company’s strong operating performance driven by continued growth in its core business of chilled water.  For the three months ended 31st March 2011, total revenue increased by 23 per cent to AED 245.6 million and operating profit increased by 55 per cent to AED 64.4 million over the same period in 2010.  Net profit fell by 25 per cent to AED 32.8 million due to higher finance costs.

Financial Highlights – Three months ended 31 March 2011

  • Total revenue increased by 23 per cent to AED 245.6 million, compared to AED 199.7 million in the same period in 2010
  • Gross profit increased by 21 per cent to AED 101.9 million, compared to AED 84.4 million in the same period in 2010
  • Net profit decreased by 25 per cent to AED 32.8 million, compared to AED 43.8 million in the same period in 2010
  • Chilled water revenue for the period was AED 183.6 million, a 32 per cent increase over the same period in 2010
  • Basic and diluted earnings per share of AED 0.08 per share

Khaled Al Qubaisi, Tabreed’s Managing Director said:

“With the completion of the recapitalization program, Tabreed has established the foundations of a strong utility business.  Tabreed delivers value, efficiency and dependability to its institutional customers and is positioned to build long-term returns for its stakeholders.  These results demonstrate the continuing improvements made by the management team and we look forward to a successful year ahead as Tabreed meets the strong demand for cooling infrastructure in the region.”

Sujit S. Parhar, Tabreed’s CEO, said:

“The first three months of 2011 have been extremely positive for Tabreed.   Our efforts have remained focused on strengthening our core business of chilled water, which is reflected in the sustained growth of our revenues.  We continue to improve operational efficiencies and reduce our costs by applying discipline in everything we do.  I am pleased to report that we remain profitable, continue to improve margins and look forward to delivering successfully on our business plan in the year ahead.”

First Quarter 2011 Highlights:

Chilled Water

Tabreed’s core business of chilled water produced revenues of AED 183.6 million, compared to AED  139.1 million in the same period in 2010.  This performance was driven by additional connections.  Gross profit increased to AED 86.7 million from AED 50.9 million in the same period the year before.

No additional plants were added in Q1 2011 but work continues on 13 plants under construction, including 8 plants for the Dubai Metro Green Line.  Tabreed’s total installed cooling capacity remained to 541,525 (gross) TR across 49 plants.

Contracting

The Company’s contracting segment recorded revenues of AED 64.1 million, compared to AED 32 million over the same period in 2010, with gross profit of AED 2.8 million compared to AED 11.5 million in the same three months of the previous year.  The results reflecting completion of the IKEA – Yas Island project and further progress with the Sowwah Island project in Tabreed’s wholly owned subsidiary, Gulf Energy Systems.

Manufacturing

Tabreed’s manufacturing segment reported revenues of AED 17.5 million compared to AED 22.7 million in the same period in 2010, while gross profit fell to AED 4.7 million compared to AED 7.6 million in the same period of 2010.  This decline was due to weak market conditions and reduced order books due to an increase in competition at Tabreed’s 60 per cent owned subsidiary, Emirates Pre-insulated Pipes Industries.

Services

Tabreed’s services segment, which is involved in the design and supervision of building electrical and mechanical works, reported revenues of AED 13.3 million compared to AED 17.4 million in the same period in 2010, while gross profit decreased to AED 7.8 million compared to AED 15 million in the same period in 2010.  The change reflects the regional real estate slowdown that affected the services division, which includes Ian Banham & Associates, l2l and Cooltech.

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