Egypt's OCI seen posting 33 pct rise in Q2 profit

Date:09-06-2011

Orascom Construction Industries, Egypt's biggest listed company, is expected to post a 33 percent increase in second-quarter net profit, according to analyst estimates.

OCI, run by billionaire tycoon Nassef Sawiris, could see profits rise to $191.4 million from the $144 million it reported for the second-quarter of 2010, according to the average forecast from 15 brokerages and investment banks.

Sawiris told Reuters in May that OCI, which reported a 77 percent jump in first-quarter net profit, was well positioned to pick up regional infrastructure projects and that the firm expected double-digit revenue and profit growth.

OCI, a building and fertilizer giant in the region, made net profit of $206 million in the first quarter, compared with a forecast of $182 million from a Reuters poll.

"It should be a better quarter on both fronts. Fertilizer production was higher and we should see better construction performance," Omar Taha of Beltone Financial said.

Protests that toppled Egypt's president and inspired unrest across the Middle East have slowed construction activity in the country at large and delayed the launch of several public private partnership projects (PPP) in Egypt, which OCI had been in a strong position to snap up.

But the firm, which made about 43 percent of its revenue from the Middle East and North Africa in the first quarter, is upbeat on demand in Abu Dhabi, Saudi Arabia, Qatar and Morocco, which have not seen the kind of turmoil that has hit elsewhere.

"OCI is venturing into more markets to compensate for what is happening in its main markets," Taha said. "It is diversified enough to make up for any shortfalls in its main markets."

The firm has bid for projects in Iraq and Morocco. In July, its Saudi Arabian subsidiary was also awarded infrastructure work worth $450 million.