| Tue 7 Jun 2005, 10:51 | | Group Five lands R940m Dubai International Airport |
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Group Five lands R940m Dubai International Airport contract
June 7, 2005
By Roy Cokayne
Pretoria - Group Five, the listed infrastructure company, in conjunction with the Al Naboodah Contracting Company, has been awarded a contract worth about R940 million by Dubai Civil Aviation for the construction of the cargo megaterminal at the Dubai International Airport.
Mike Lomas, Group Five`s chief executive, said yesterday that it would be one of the largest multidisciplinary projects ever undertaken by the group and increased the total value of its current contracts in Dubai to more than R1.2 billion.
Lomas said it would increase Group Five`s order book by about 12 percent, but declined to quantify its value because it was in a closed period pending the release of its annual financial results.
It is the second major contract at the new Dubai International Airport awarded to a South African-based firm.
In December last year, Murray & Roberts (M&R), the listed construction and engineering group, reported it had been awarded a contract valued at about $1 billion (R6.7 billion) by the Dubai department of civil aviation.
M&R, which is the project leader with a 40 percent share, was awarded the contract for the completion of terminal three, concourse two and a car park at the airport as part of the joint venture of Al Habtoor Murray & Roberts and Takenaka.
Dubai International Airport is expanding with a $4.1 billion project, which is designed to meet an escalating influx of travellers. About 20 million passengers passed through the airport last year, and it has been projected that this could rise to 60 million by 2010.
Lomas said Group Five would construct a multistorey building, cargo handling and packaging area, large multilevel car park, mechanical, electrical and piping installations and a steel connecting bridge.
Work on the contract began earlier this month and its duration would be 15 months.
Group Five was already working in a consortium with BK Gulf and in joint venture with Al Naboodah Contracting Company at the international airport on a R550 million contract for the central utilities complex-6.
It had also been awarded a contract for the Emirates aeroplane test centre for General Electric/Emirates Airlines valued at about R110 million, which commenced this month and was due for completion in October next year, he said.
Group Five had a 75 percent share of the cargo terminal contract, while the three joint venture partners for the central utilities complex-6 contract would each receive different amounts.
These contracts confirmed the group`s ability to establish a strong, viable international operation in the region. It validated the group`s strategy of balancing its income streams between local and international currencies, with more than 30 percent of revenues coming from offshore.
`This positive boost comes at a time when we have downsized our South African civil business due to the lack of local work and also during a period of extreme rand volatility,` he said.
Group Five shares were up 70c to close at R14.40 yesterday. M&R was up 30c at R14.10. The construction and building sector improved 1.25 percent
