(Emirates Steel Arkan), listed on the Abu Dhabi Stock Exchange and the largest national listed company operating in the iron and steel manufacturing sector, building materials and construction, announced today, Tuesday, its financial results for the third quarter of 2022.
(Emirates Arkan Steel) recorded a net profit of 103 million dirhams during the third quarter of 2022, compared to an initial pre-merger loss of 79 million dirhams for the same period in 2021.
These gains were driven by the strategy adopted by (Emirates Arkan Steel) to diversify revenues by increasing the volume of exports to more than 70 markets, in addition to the tight management of costs and enhancing operational efficiency.
Profits of (Emirates Arkan Steel) before interest, taxes, depreciation and amortization increased during the third quarter to 269 million dirhams, a growth of 224% year-on-year. While the group's revenues increased during the third quarter of this year to 2.51 billion dirhams compared to the initial revenues for the same period in 2021, which amounted to 1.94 billion dirhams, a growth of 29%.
Moreover, the revenues of (Emirates Steel Arkan) for the first nine months of this year increased to 7.12 billion dirhams, compared to the initial revenues during the corresponding period of the previous year, which amounted to 6.19 billion dirhams.
And (Emirates Arkan Steel) recorded earnings before interest, taxes, depreciation and amortization amounting to 863 million dirhams, compared to the initial profits for the first nine months of 2021, which amounted to 369 million dirhams, a growth of 134% on an annual basis. While the net profit amounted to 383 million dirhams during the first nine months of 2022 compared to an initial loss before the merger amounted to 119 million dirhams for the same period last year.
Following the merger during the last quarter of 2021, Emirates Steel continued to contribute 90% of the group's revenue, while Arkan contributed 10%. Emirates Steel’s business revenues increased during the first nine months of this year to 6.45 billion dirhams, compared to non-consolidated pre-merger revenues of 5.6 billion dirhams during the first nine months of 2021, supported by strong sales in Europe and the Americas and increased demand in the UAE.
Talking about the performance of the business units separately, Arkan's business continued to perform strongly in light of intensive marketing campaigns, price increases and improved lower-cost production in the group. Arkan achieved a net profit of 48.9 million dirhams during the first nine months of 2022 compared to a loss of 29.2 million dirhams during the same period of the previous year, an improvement of 78.1 million dirhams.
On the other hand, the balance sheet of (Emirates Arkan Steel) witnessed a remarkable improvement at the end of the first nine months period, which reflects the success of the Nama program for transformation and cost reduction launched by the group, in addition to the sales growth and price increase during the mentioned period. The net volume of the group’s bank loans decreased by 41% to reach 1.34 billion dirhams at the end of September 2022, compared to 2.28 billion dirhams at the end of December 2021.
in this occasion; Hamad Abdullah Al Shurafa Al Hammadi, Chairman of Emirates Steel, Arkan, said: Our strong profits during the third quarter are tangible evidence of the success of our strategy that revolves around seizing new opportunities in the 70 global markets to which we export our products, in line with the economic vision of the Emirate of Abu Dhabi. At the same time, we maintained our commitment to meet the requirements of the local market and support Abu Dhabi's industrial strategy.
Al Hammadi continued: To this end, we continue to accelerate our efforts to contribute to supporting the growth of local industries and promote the 'Made in UAE' brand and are studying flat steel production options for manufacturing customers. The country's economy is expected to maintain its steady pace of growth despite the expected global slowdown, which provides our group with a stimulating work environment that helps us continue implementing our expansion plans. During the quarter, the group announced that it has entered into a partnership with Itocho Corporation and GFE Steel Corporation; To study the possibility of establishing a complex for the production of iron ore materials in Abu Dhabi.
If the project is approved, this complex will be a major part of the global supply chain for low-carbon steel, which will enhance the contribution of the group's strategy to support national goals to reduce carbon emissions. The production of iron ore materials will be mainly supplied to customers in Asia, including GFE Steel.
