Depa Limited (ticker DEPA) (‘Depa’ or ‘the Company’), one of the world’s leading interior contracting companies, today issues the following update for the first quarter ended 31 March 2009.
Depa saw first quarter revenue and profit growth of over 40% compared to the same period last year. The Company confirms that it is still on target to achieve approximately 30% revenue and profit growth for the full year 2009, a significant amount of which is expected to come from Abu Dhabi, Saudi Arabia and Asia.
The business is highly seasonal with a substantial portion of contract income being recognised in the second half of the year. This cyclicality in revenue recognition is a characteristic of the interior contracting sector as the end of the fiscal year is usually used as contract deadline by clients. Depa is taking steps to reduce this cyclicality and has seen significant improvement in this regard, as illustrated by the substantial revenue and profit growth this quarter, which is a higher proportion of expected annual results than previous years.
Depa is performing well and the business continues to have a strong contracted backlog of approximately AED 3.2 billion as of 31 March 2009. In line with its strategy, Depa continues to diversify revenues and reduce dependence on the Dubai market. Projects that have been delayed do not account for more than 4% of the December backlog and are not accounted for in the overall backlog number issued for the first quarter. No client or contract accounts for more than 8% of the current backlog.
This backlog consists entirely of projects that are already at the advanced construction stage. Being at the end of the development chain, Depa typically moves on site to finish the building for occupation and hence, at a stage where the project is extremely unlikely to be cancelled, such as Burj Dubai. Payments from clients have not deteriorated and remain in line with historical practices.
Depa continues in its strategy of reducing dependence on the hospitality sector. The Company is increasingly focused on the refurbishment and infrastructure sectors, which are counter-cyclical in a downturn. Depa is currently carrying out refurbishment works for airports across the region and is on target to complete fit out works for the Dubai Metro later this year.
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For further inquiries, please contact:
Depa Limited
Noor Sweid
Managing Director, Strategy
Tel: +971 4 224 3800
noor.sweid@depa.com
Brunswick Gulf Ltd
Azadeh Varzi
Tel: + 971 4 365 8260
Depa Limited is a leading interior contracting company in the Middle East, North Africa and Southeast Asia regions. Operating principally in the luxury fit-out industry, its main areas of business cover 5 star hotels, high-end residential properties, retail outlets, yachts, as well as public sector amenities such as hospitals and airports. Depa is listed on the NASDAQ Dubai (ticker DEPA) and has Global Depositary Receipts on the regulated market for listed securities of the London Stock Exchange plc (ticker DEPA and DEPS).
The range of business activities performed by Depa comprises:
By integrating these services into a single package, Depa provides clients with comprehensive and customized interior contracting solutions.
With more than 8,000 employees worldwide, the company operates through an integrated network of subsidiaries, affiliates and representative offices located in the UAE, Saudi Arabia, Qatar, Egypt, Jordan, Syria, Libya, Morocco, India, Malaysia, Thailand, China, Singapore, UK, the Netherlands, and the United States. Through this network, Depa has successfully executed large and complex projects in over 16 countries including the Burj Al Arab Hotel (Dubai), Emirates Palace (Abu Dhabi), the Museum of Islamic Art (Doha), Four Seasons Hotels (Sharm El Sheikh & Mumbai) and Mazagan Resort (Casablanca).
