Abu Dhabi Ship Building expects revenue growth in 2021 on higher exports
The company will target countries that border the Indian Ocean, chief executive says
Abu Dhabi Ship Building, listed on Abu Dhabi's Securities Exchange, expects higher revenue this year as it focuses on exporting its vessels to different markets, its chief executive said.
The company which recorded revenue of Dh254 million last year, will target markets in countries that border the Indian Ocean, David Massey told The National in an interview. It also plans to boost its presence in the luxury boat market.
“ADSB has only exported to GCC countries till now and we are going beyond GCC to East Africa, North Africa and the Indian Ocean,” Mr Massey said.
He added, however, that the UAE's navy and the country’s Critical Infrastructure and Coastal Protection Authority (Cicpa) will continue to be its primary customer.
The company, which is part of defence conglomerate Edge, manufactures corvettes, offshore patrol vessels and fast patrol boats. It also provides a full range of maintenance, repairs and refits as well as upgrades and conversions.
“Margins are better on export business than they are on selling to the domestic customer,” Mr Massey said.
“Last year was the absolute bottom of the cycle for ADSB and in 2021 will see a modest increase in revenues but there will be a much more significant increase in revenues in 2022.”
Earlier this week, the company showcased two rigid-hulled fast patrol boats of 16 metres and 12 metres in size aimed at coast guards.
“We’ve seen a huge amount of interest from coast guards. All of them have the same requirements and have problems with piracy, smuggling and fisheries protection.”
ADSB, which posted losses of Dh21.8m last year, does not expect to return to full-year profitability until next year.
“The company will return to profit sometime this year (in the fourth quarter). In 2022 we are projecting a full year profit.”
It is also planning to sell an “uneconomic” floating dock at Mina Zayed to cut costs.
ADSB is one of 25 entities that make up Edge – a defence conglomerate formed in 2019 that specialises in developing advanced technology for weapons systems, cyber protection and electronic warfare.
Updated: February 25, 2021 08:19 PM