Al-Babtain's backlog exceeds SAR 2.5B in 2024: Chairman

Ibrahim Al Babtain, Chairman of Al-Babtain Power & Telecommunication Co.

Al-Babtain Power & Telecommunication Co. is implementing contracts worth over SAR 2.5 billion during 2024, which is reflected in the indicators of infrastructure projects and outstanding renewable energy projects in the Kingdom, particularly the announced wind energy projects, Chairman Ibrahim Al Babtain told Argaam in a call.

Al Babtain also pointed to the growth and development of infrastructure projects adopted by the Kingdom, as the state budget indicates immense spending on various projects and new cities where doing business is ongoing and active.

For more exclusive interviews

This is besides the company’s towers segment, which is witnessing huge demand for electrical energy transmission projects that meet the requirements of the mega projects under the Saudi Vision 2030, the chairman further stated.

Regarding the lampposts and lighting segment, he noted that it is a very promising segment given its direct service to mega projects such as the Diriyah, Qiddiya, and Al-Ula projects as well as the King Salman Park, Al-Orouba Park, NEOM, and the rest of the significant projects coming under the Kingdom’s Vision 2030 going forward.

He stressed that the company's current plans focus on providing new products and solutions in the segments it operates in. This is in addition to working on strengthening its competitive position in the Gulf markets and the rest of the Middle East.

As for financial results, the chairman said the unprecedent Q4 2023 results were ascribed to efforts exerted by the company’s management, which were well reflected in the annual results. He further indicated that the fourth-quarter profit growth was due to the increase in sales and profit margins, and improved selling prices, which led to the notable improvement in operational performance.

Al-Babtain’s dividend distribution policy mainly depends on the expansion plans, projects undertaken, and cash flows to support profit distribution decisions, as the board of directors study the matter in cooperation with the executive management on an annual basis. In general, the company’s board is keen on permanent and continuous cash distributions, he said.

Furthermore, the top executive stated that financing costs (FCs) are not expected to be cut due to the fundamental link to the activity volume, which is increasing from year to year. Therefore, increased activity is followed by a rise in borrowing and hence higher FCs, he said, stressing the importance of maintaining the leverage and the ratio of debt to shareholders’ equity at safe levels, being the key target for Al-Babtain.

Speaking on transferring assets of Al-Babtain’s branch for lighting and distribution panels to the Integrated Lighting Co. (Rayon), a subsidiary, the chairman explained that the company moved the factory to maximize its benefit and to expand work with Rayon, with a focus in the coming period on providing lighting solutions to all the company's clients in this important segment, which serves the giant projects proposed in the Kingdom.

He expected the related impact to be positive on the company's sales, which will be reflected in the consolidated results during the coming period.

According to the data available in Argaam, Al-Babtain's profits rose to SAR 141.5 million by the end of 2023, from SAR 52.7 million in 2022. Q4 earnings stood at SAR 43.3 million.