ALEC Holdings H1 Revenue Jumps 67.6% as Backlog Hits $8.85 Billion

DUBAI, UAE: ALEC Holdings recorded strong revenue growth during the first half of 2026, with its secured project backlog reaching $8.85 billion (AED32.5 billion) as continued investment across construction, aviation, hospitality, energy and digital infrastructure supports activity in the UAE and Saudi Arabia.

The Investment Corporation of Dubai subsidiary reported revenue of nearly $2.45 billion (AED9.0 billion) for H1 2026, an increase of 67.6% year-on-year, reflecting the ramp-up of major projects and higher activity across its operating segments.

Second-quarter revenue increased 51.3% year-on-year to $1.20 billion (AED4.4 billion).

ALEC closed the first half with a backlog of $8.85 billion (AED32.5 billion), representing estimated revenue yet to be delivered from secured projects and providing the group with visibility over future activity.

Chief Executive Officer, Barry Lewis said,

“H1 2026 was a period of strong growth, with revenue increasing 67.6% year-on-year to AED 9.0 billion, reflecting the scale of activity and strength of delivery across our portfolio. We also secured significant new work, including our appointment to deliver Sphere Abu Dhabi and three EPC awards on Das Island for our Energy Services subsidiary, TARGET, with a combined value exceeding AED 1.8 billion.

At the height of the regional conflict, extended stoppages to offshore work temporarily curtailed activity within our Energy Services business, limiting its potential revenue contribution while the Group continued to carry the cost of idled manpower. We actively managed these pressures through disciplined cost control and project and workforce planning, while maintaining execution momentum across the wider portfolio.

The demand backdrop across the UAE and Saudi Arabia remains constructive, supported by continued investment in large-scale urban development, aviation, energy, hospitality and digital infrastructure. Our AED 32.5 billion backlog provides strong visibility over future activity, and we continue to deploy our capacity selectively, prioritising complex, large-scale projects that align with our capabilities and where our integrated platform delivers the greatest value to clients.”

Building and Construction Revenue More Than Doubles

Building & Construction remained ALEC's largest revenue contributor during the first half, with revenue increasing 105.6% year-on-year to $1.58 billion (AED5.8 billion).

Growth was supported by accelerated execution across major projects including Stargate Data Centre, Wynn Al Marjan Resort and the ilmi Science and Discovery Center.

The segment's gross profit margin improved by 47 basis points year-on-year to 7.0%, reflecting a more favourable project mix and a greater contribution from newer projects carrying higher margins.

In Q2, Building & Construction revenue rose 96.9% year-on-year to nearly $817 million (AED3.0 billion), while gross profit margin increased to 7.1% from 6.3% in Q2 2025.

Related Businesses also recorded substantial growth, generating $708 million (AED2.6 billion) in H1 revenue, an increase of 123.7% year-on-year. The performance was supported by greater integration, increased cross-selling and a higher contribution from internally generated work.

Activity included MEP and fit-out works at Wynn Al Marjan Island Resort and façade works at the ilmi Science Discovery and Innovation Center, alongside other projects across ALEC's portfolio.

Energy Services Impacted by Regional Disruption

Energy Services revenue increased 36.9% year-on-year to $762 million (AED2.8 billion) in H1 as work progressed across EPC contracts and the wider energy infrastructure portfolio.

However, disruption associated with regional geopolitical developments affected profitability. The segment recorded a gross loss of $42.9 million (AED157.5 million), resulting in a negative gross margin of 5.7%, compared with a positive margin of 9.4% in H1 2025.

The impact became more pronounced during Q2, when Energy Services recorded a gross loss of $54.9 million (AED201.5 million) and a negative gross margin of 16.1%.

ALEC said extended stoppages to offshore work temporarily curtailed activity while the group continued to carry costs associated with idled manpower.

Despite the disruption, the company secured three EPC awards on Das Island for its Energy Services subsidiary TARGET, with a combined value exceeding $490 million (AED1.8 billion).

Read more: ALEC Awarded $1.7 Billion Contract to Build Sphere Abu Dhabi

H1 Net Profit Reaches $58.2 Million

At group level, gross profit declined 4.4% year-on-year to $139.7 million (AED513.1 million) in H1, as higher Energy Services contract costs offset the impact of strong revenue growth. Gross profit margin consequently declined by 430 basis points to 5.7%.

EBITDA increased 2.7% to $119.9 million (AED440.4 million), although the EBITDA margin narrowed to 4.9% from 8.0% in H1 2025.

Net profit declined 10.5% year-on-year to $58.2 million (AED213.8 million), representing a margin of 2.4%, compared with 4.5% a year earlier.

ALEC attributed the decline primarily to lower operating profit following disruptions within Energy Services. Higher income tax expenses following the implementation of OECD Pillar II rules in certain jurisdictions also affected the result.

Q2 recorded a net loss of $4.5 million (AED16.6 million), compared with net profit of $33.9 million (AED124.5 million) in Q2 2025.

The Board of Directors approved an interim cash dividend of $27.2 million (AED100 million) for H1 2026, payable in October.

Liquidity Strengthens as Operations Expand

ALEC's total assets increased 15.3% to $3.32 billion (AED12.2 billion) as of 30 June 2026, compared with $2.89 billion (AED10.6 billion) at the end of 2025.

Cash and bank balances increased to $654 million (AED2.4 billion) from $436 million (AED1.6 billion) at 31 December 2025, contributing to a net cash position of $272 million (AED1.0 billion).

Net cash generated from operating activities rose 7.6% year-on-year to $189 million (AED694.6 million) in H1. Free Cash Flow to Firm increased 49.8% to $148 million (AED544.8 million).

The group said its low leverage and liquidity position provide financial flexibility as the scale of operations continues to expand.

UAE and Saudi Arabia Drive Project Pipeline

ALEC expects demand conditions across its principal markets to remain supportive, underpinned by major infrastructure and development programmes.

In the UAE, the company highlighted investment across aviation, energy, hospitality and digital infrastructure, including the expansion of Al Maktoum International Airport, ADNOC's investment programme and growing data-centre requirements.

The award of Sphere Abu Dhabi was also highlighted as evidence of demand for contractors capable of delivering projects of significant scale and complexity.

In Saudi Arabia, Vision 2030 continues to generate opportunities across giga-projects, tourism, energy and urban development. ALEC said it remains selective in pursuing projects, prioritising opportunities with appropriate pricing, risk allocation and return characteristics.

With a $8.85 billion (AED32.5 billion) backlog, a net cash position and continued investment across its core markets, ALEC said its secured portfolio provides strong medium-term visibility, despite the near-term impact of disruption within its Energy Services business.