Emirates Steel Arkan Achieves AED 3.96 Billion In Revenues For H1 2024 Amid Market Challenges

Emirates Steel Arkan has reported its financial results for the first half of 2024, showing revenues of AED 3.96 billion and an EBITDA of AED 503 million. Despite facing challenging conditions in both export and domestic markets, the Group maintained stable performance throughout H1 2024.

International steel markets have been under pressure due to a slowdown in the Chinese economy and global geopolitical uncertainties. The Group's overall production volumes remained consistent with H1 2023 by strategically redirecting part of its international exports to the UAE market.

In H1 2024, Emirates Steel Arkan achieved total revenues of AED 3.96 billion, which is about 10% lower than the AED 4.43 billion recorded in H1 2023. The Group's EBITDA stood at AED 503 million, while net profit before tax was AED 191 million.

The Steel division generated revenue of AED 3.60 billion during H1 2024, resulting in a profit before tax of AED 140 million. Meanwhile, the Building Materials division reported revenue of AED 353 million and a profit before tax of AED 51 million.

The Group was recognised as the 2024 Steel Sustainability Champion by the World Steel Association for its pioneering efforts in decarbonising steel production throughout 2023. Additionally, it received commendation from the World Economic Forum for its outstanding contributions to decarbonising the iron and steel industry.

Emirates Steel Arkan's contributions to the UAE’s industrial sector were acknowledged at the Make it in the Emirates Awards 2024. The Group received two prestigious awards: Best Sustainable Manufacturing Award and ICV Excellence Award, and was a finalist for the Excellence in Innovation Award.

Operational Highlights

The Group continued to upgrade its current assets to meet evolving market requirements and increasing demand for higher-grade steel. These strategic enhancements highlight its commitment to innovation, quality, and customer satisfaction.

Saeed Ghumran Al Remeithi, Director and Group Chief Executive Officer, stated, "Emirates Steel Arkan 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 AED 3.96 billion and EBITDA of AED 503 million. This achievement underscores our unwavering commitment to operational excellence and innovation."

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."

Future Outlook

The Group plans to maintain its focus on supplying premium steel products known for sustainability, low carbon emissions, and durability to landmark projects in the region. This includes their latest agreement with Eversendai for constructing NEOM Trojena Ski Village.

During H1 2024, Emirates Steel Arkan improved its cash position significantly, holding AED 610 million at the end compared to AED 426 million as of December 31, 2023. This improvement reflects their ongoing cost reduction and transformation programme that added an incremental EBITDA enhancement of AED 78 million during this period.

The Group's resilience amid challenging market conditions showcases its strategic flexibility and commitment to sustainable practices while continuing to innovate within the industry.

With inputs from WAM