Conditions in Saudi Arabia’s contracting market are likely to improve this year but only in the second half, according to the head of a leading construction company in the kingdom.
Fawwaz Al Khodari, the chief executive of Al Khodari Sons, said that his company had experienced “a very, very challenging year in 2016”, along with the rest of the Saudi market as the government halted payments for most of the year and held off from awarding new contracts.
The Tadawul-listed company won just 214 million Saudi riyals (Dh209.6m) worth of new work during the year – an 86 per cent drop on 2015. It posted a net loss of 118m riyals, compared with a profit of 33.4m in 2015 as revenue declined by 34 per cent to 1.03 billion riyals.
“Government spending has been extremely low on infrastructure projects, and that huge dive naturally impacts our awards, and therefore our revenue and our bottom line as well,” Mr Al Khodari said.
He said that government spending on infrastructure is likely to significantly increase this year, with capital spending likely to rise by 43 per cent to 262bn riyals.
“Last year, it [the government] did have an allocation but to be very frank we did not see very much of this on the ground.”
This year, Mr Al Khodari said he does not expect any new awards in the first quarter, as this is only when government departments will start tendering again.
“The active government bodies will award in the second quarter, and then in the third and fourth quarter you will start to see the revenue being booked,” he said.
He said that he expects to pick up more work as plenty of contracting capacity has been removed from the markets as firms have shrunk in size. He also expects more work to be generated in the housing sphere as more plots are developed in response to the white land tax.
Mr Al Khodari also said that payments owed by the government were being made to contractors, but this was slow in coming through.
“We expect the ministry of finance will be paying from 60 days of a payment order being issued, but we’ve voiced our concern in that a payment order takes a long time to be issued.”
In some cases, he said that payment orders have taken as long as nine months to be generated as invoices “keep ping-ponging” between various government departments.
He expects this situation to improve next year once the new National Project Management Office is set up and a new electronic payments system implemented.
Meanwhile, Saudi Arabia’s other listed contractor, the embattled Mohammed Al Mojil Group, said on Thursday that its net loss for 2016 dropped by 49 per cent to 161.2m riyals. The company, whose shares have not traded since 2012, has now accrued cumulative losses of 3.7bn riyals and it has a shareholders’ deficit of just short of 2.5bn riyals.
Last month, the company said that the ministry of labour had filed a case against it demanding that it pay 88m riyals it owes to employees from the sale of company assets.
David Clifton, a regional development director for the project management company Faithful + Gould, said that there were about 330,000 redundancies in Saudi Arabia’s contracting sector last year.
“Overall, I’d suggest that in Saudi, the market hit the basement last year. We tracked about US$20bn worth of awards. I think that’s going up by a very high percentage factor. I think that should be about $27bn this year, but that relies on Mecca Metro being awarded.”
mfahy@thenational.ae
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The five pillars of Islam
Wicked
Director: Jon M Chu
Stars: Cynthia Erivo, Ariana Grande, Jonathan Bailey
The specs
Engine: 77.4kW all-wheel-drive dual motor
Power: 320bhp
Torque: 605Nm
Transmission: Single-speed automatic
Price: From Dh219,000
On sale: Now
How to come clean about financial infidelity
- Be honest and transparent: It is always better to own up than be found out. Tell your partner everything they want to know. Show remorse. Inform them of the extent of the situation so they know what they are dealing with.
- Work on yourself: Be honest with yourself and your partner and figure out why you did it. Don’t be ashamed to ask for professional help.
- Give it time: Like any breach of trust, it requires time to rebuild. So be consistent, communicate often and be patient with your partner and yourself.
- Discuss your financial situation regularly: Ensure your spouse is involved in financial matters and decisions. Your ability to consistently follow through with what you say you are going to do when it comes to money can make all the difference in your partner’s willingness to trust you again.
- Work on a plan to resolve the problem together: If there is a lot of debt, for example, create a budget and financial plan together and ensure your partner is fully informed, involved and supported.
Carol Glynn, founder of Conscious Finance Coaching
Company%20profile
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Company%20Profile
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Company%20Profile
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Kanguva
Director: Siva
Stars: Suriya, Bobby Deol, Disha Patani, Yogi Babu, Redin Kingsley
SPECS
Engine: 4-litre V8 twin-turbo
Power: 630hp
Torque: 850Nm
Transmission: 8-speed Tiptronic automatic
Price: From Dh599,000
On sale: Now
If you go
The flights
The closest international airport for those travelling from the UAE is Denver, Colorado. British Airways (www.ba.com) flies from the UAE via London from Dh3,700 return, including taxes. From there, transfers can be arranged to the ranch or it’s a seven-hour drive. Alternatively, take an internal flight to the counties of Cody, Casper, or Billings
The stay
Red Reflet offers a series of packages, with prices varying depending on season. All meals and activities are included, with prices starting from US$2,218 (Dh7,150) per person for a minimum stay of three nights, including taxes. For more information, visit red-reflet-ranch.net.
COMPANY%20PROFILE
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COMPANY PROFILE
Name: HyperSpace
Started: 2020
Founders: Alexander Heller, Rama Allen and Desi Gonzalez
Based: Dubai, UAE
Sector: Entertainment
Number of staff: 210
Investment raised: $75 million from investors including Galaxy Interactive, Riyadh Season, Sega Ventures and Apis Venture Partners
South Africa World Cup squad
South Africa: Faf du Plessis (c), Hashim Amla, Quinton de Kock (w), JP Duminy, Imran Tahir, Aiden Markram, David Miller, Lungi Ngidi, Anrich Nortje, Andile Phehlukwayo, Dwaine Pretorius, Kagiso Rabada, Tabraiz Shamsi, Dale Steyn, Rassie van der Dussen.
How to protect yourself when air quality drops
Install an air filter in your home.
Close your windows and turn on the AC.
Shower or bath after being outside.
Wear a face mask.
Stay indoors when conditions are particularly poor.
If driving, turn your engine off when stationary.
The Disaster Artist
Director: James Franco
Starring: James Franco, Dave Franco, Seth Rogan
Four stars
Electoral College Victory
Trump has so far secured 295 Electoral College votes, according to the Associated Press, exceeding the 270 needed to win. Only Nevada and Arizona remain to be called, and both swing states are leaning Republican. Trump swept all five remaining swing states, North Carolina, Georgia, Pennsylvania, Michigan and Wisconsin, sealing his path to victory and giving him a strong mandate.
Popular Vote Tally
The count is ongoing, but Trump currently leads with nearly 51 per cent of the popular vote to Harris’s 47.6 per cent. Trump has over 72.2 million votes, while Harris trails with approximately 67.4 million.
COMPANY%20PROFILE
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UAE currency: the story behind the money in your pockets
The specs: 2018 Ducati SuperSport S
Price, base / as tested: Dh74,900 / Dh85,900
Engine: 937cc
Transmission: Six-speed gearbox
Power: 110hp @ 9,000rpm
Torque: 93Nm @ 6,500rpm
Fuel economy, combined: 5.9L / 100km
COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
RESULTS FOR STAGE 4
Stage 4 Dubai to Hatta, 197 km, Road race.
Overall leader Primoz Roglic SLO (Team Jumbo - Visma)
Stage winners: 1. Caleb Ewan AUS (Lotto - Soudal) 2. Matteo Moschetti ITA (Trek - Segafredo) 3. Primoz Roglic SLO (Team Jumbo - Visma)
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
The specs
Engine: 1.5-litre turbo
Power: 181hp
Torque: 230Nm
Transmission: 6-speed automatic
Starting price: Dh79,000
On sale: Now
Citadel: Honey Bunny first episode
Directors: Raj & DK
Stars: Varun Dhawan, Samantha Ruth Prabhu, Kashvi Majmundar, Kay Kay Menon
Rating: 4/5
The biog
Favourite food: Fish and seafood
Favourite hobby: Socialising with friends
Favourite quote: You only get out what you put in!
Favourite country to visit: Italy
Favourite film: Lock Stock and Two Smoking Barrels.
Family: We all have one!
Bugatti Chiron Super Sport - the specs:
Engine: 8.0-litre quad-turbo W16
Transmission: 7-speed DSG auto
Power: 1,600hp
Torque: 1,600Nm
0-100kph in 2.4seconds
0-200kph in 5.8 seconds
0-300kph in 12.1 seconds
Top speed: 440kph
Price: Dh13,200,000
Bugatti Chiron Pur Sport - the specs:
Engine: 8.0-litre quad-turbo W16
Transmission: 7-speed DSG auto
Power: 1,500hp
Torque: 1,600Nm
0-100kph in 2.3 seconds
0-200kph in 5.5 seconds
0-300kph in 11.8 seconds
Top speed: 350kph
Price: Dh13,600,000
MATCH INFO
Championship play-offs, second legs:
Aston Villa 0
Middlesbrough 0
(Aston Villa advance 1-0 on aggregate)
Fulham 2
Sessegnon (47'), Odoi (66')
Derby County 0
(Fulham advance 2-1 on aggregate)
Final
Saturday, May 26, Wembley. Kick off 8pm (UAE)
Bridgerton%20season%20three%20-%20part%20one
%3Cp%3E%3Cstrong%3EDirectors%3A%20%3C%2Fstrong%3EVarious%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%3C%2Fstrong%3E%20Nicola%20Coughlan%2C%20Luke%20Newton%2C%20Jonathan%20Bailey%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E3%2F5%3C%2Fp%3E%0A
Company%20Profile
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THE%20HOLDOVERS
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From Zero
Artist: Linkin Park
Label: Warner Records
Number of tracks: 11
Rating: 4/5
Results
2.30pm: Handicap (PA) Dh40,000 1,700m; Winner: AF Mezmar, Adam McLean (jockey), Ernst Oertel (trainer).
3pm: Maiden (PA) Dh40,000 2,000m; Winner: AF Ajwad, Tadhg O’Shea, Ernst Oertel.
3.30pm: Handicap (PA) Dh40,000 1,200m; Winner: Gold Silver, Sam Hitchcott, Ibrahim Aseel.
4pm: Maiden (PA) Dh40,000 1,000m; Winner: Atrash, Richard Mullen, Ana Mendez.
4.30pm: Gulf Cup Prestige (PA) Dh150,000 1,700m; Winner: AF Momtaz, Saif Al Balushi, Musabah Al Muhairi.
5pm: Handicap (TB) Dh40,000 1,200m; Winner: Al Mushtashar, Richard Mullen, Satish Seemar.
