Rising revenue in US offsets decline in Egypt for Orascom

Neil Gerrard Senior Editor, Construction Briefing

22 March 2024

Orascom is building the longest monorail system in the world. The first line runs 54km from East Cairo to the New Administrative Capital. The second line will be around 42km in length connecting the Giza Governorate to Sixth of October City. (Image: Orascom)

Construction group Orascom’s revenue fell more than 19% to US$3.4 billion in 2023 amid tough trading conditions in its home market of Egypt.

But a stronger performance in the USA helped to offset some of the decline. Orascom’s revenue in the Middle East and Africa was down more than a third (35.7%) to $1.8 billion. But it increased in the US by 14.2% to nearly $1.6 billion.

Orascom owns US subsidiaries Weitz, based in Des Moines, Iowa, and Contrack Watts, based in Virginia. In 2023, its US subsidiaries signed nearly $2 billion in new awards, which was a 52.3% increase. The group has been expanding in areas such as data centres, airports and commercial projects.

Weitz also won a large contract to build the first phase of the new terminal at Des Moines International Airport.

Despite an ongoing economic crisis in Egypt, Orascom signed $3.8 billion of new awards in the country and in the United Arab Emirates (UAE) in 2023, of which $1.3 billion came during the final quarter.

The business signed contracts to build a new phase of the Greater Cairo Metro Line 4 and to execute the MEP works for all 23 stations of the Green Line high-speed railway. It also signed contracts for a new fertilizer plant and a private sector development on Egypt’s north coast.

The company also owns a 50% share of the Besix Group. Its order backlog stands at €5.1 billion (US$5.5 billion), which was down 3.1% year on year.

Oracom’s total order backlog as of 31 December 2023 was a record $8.1 billion. More than two-thirds of that (68.3%) is orders are within Egypt, with the US accounting for 21.5% and UAE 7.9%. Infrastructure projects make up the bulk of the order backlog at 71.8%, followed by commercial (14.5%) and industrial (13.7%).

Orascom’s net income in 2023 was $158.6 million, up from $113.5 million in 2022.

Orascom chief executive officer Osama Bishai said, “We believe that we have established the right fundamentals that have allowed us to navigate the current environment and position us well for the challenges of 2024.

“Throughout the year, we continued to sign quality, internationally funded new projects in Egypt, further diversified our regional presence in the UAE, and strengthened our U.S. business across growth sectors such as data centres and airports.”

Egypt and UAE drive record order backlog for Orascom despite revenue slide Egypt-based construction company Orascom has seen its order backlog rise to a record US$7 billion, despite a decline in revenue which it blamed on the devaluation of the Egyptian pound.