Emirates Steel Arkan (ESA), one of the largest public steel and building materials manufacturers in the region, has earned first-half (H1) revenues of AED3.96 billion ($1.08 billion) and EBITDA of AED503 million ($137 million). 

 

The group has delivered stable performance throughout H1 2024, despite challenging conditions impacting both export and domestic markets. International steel markets remain under pressure, primarily as a result of the slowdown in the Chinese economy and global geopolitical uncertainties. 

 

Financial highlights H1

In H1 2024, the group maintained overall production volumes in line with H1 2023. This was achieved through strategic flexibility, allowing part of the international exports to be redirected to the UAE market. The group's revenues of AED3.96 billion was approximately 10% below the AED4.43 billion in H1 2023. The group’s net profit before tax was AED191 million.

 

Revenue from the Steel division totalled AED3.60 billion during H1 2024, generating a profit before tax of AED140 million. Revenue from the Building Materials division was AED353 million in H1 2024, with profit before tax of AED51 million. 

 

The group’s performance demonstrates its resilience in challenging market conditions. In particular, the group’s continuing cost reduction and transformation programme contributed an incremental EBITDA enhancement of AED78 million in H1 2024.

 

It further improved its cash position, and as of the end of H1 2024 the group had AED610 million cash in hand compared to AED426 million as of December 31, 2023.

 

The company continues its ongoing upgrade of its current assets to better address the evolving requirements of the market and respond to the increasing demand for higher-grade steel. These strategic enhancements underscore its commitment to innovation, quality, and customer satisfaction.

 

Exceptional resilience

Eng Saeed Ghumran Al Remeithi, Director and Group Chief Executive Officer, ESA, said: “ESA has demonstrated exceptional resilience and strategic vision amidst challenging market conditions. Our performance in the first half of 2024 is strong, evidenced by revenues of AED3.96 billion and EBITDA of AED503 million. This achievement underscores our unwavering commitment to operational excellence and innovation. The Group’s focus on cost reduction and transformative initiatives has been pivotal in maintaining our competitive edge. Moreover, our recognition by the World Economic Forum for pioneering decarbonisation in steel production underscores our dedication to sustainable practices and our vision for a low-carbon future.”

 

He added: “As we enter the second half of the year, we will remain vigilant in monitoring market dynamics to stay agile. We will continue to collaborate closely with our downstream customers to meet their needs for value-added and low-carbon products. 

 

“Additionally, we will maintain our commitment to supplying premium steel products, known for their sustainability, record-setting low carbon emissions, and exceptional durability, to landmark projects in the region, such as our latest agreement with Eversendai for the construction of the NEOM Trojena Ski Village.”--TradeArabia News Service