One of the UAE and Saudi Arabia’s leading engineering and construction groups, ALEC Holdings PJSC has reported strong financial results for the first half of 2026. The company’s revenue increased by 67.6% year-on-year to nearly AED 9.0 billion, while second-quarter revenue rose 51.3% to AED 4.4 billion. The strong performance was supported by continued project execution and a closing project backlog of AED 32.5 billion.
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.”
Chief Financial Officer, John Deeb commented:
“The first half of 2026 demonstrated the scale and resilience of our operating model, with revenue increasing 67.6% year-on-year to AED 9.0 billion. EBITDA increased 2.7% to AED 440.4 million, while Net Profit reached AED 213.8 million, with Q2 profitability impacted by operational disruptions in Energy Services related to regional geopolitical developments and the associated absorption of fixed costs, partially mitigated by disciplined cost management.
Cash generation remains a key strength, with net cash from operating activities of AED 694.6 million and Free Cash Flow to Firm increasing 49.8% year-on-year to AED 544.8 million. Capital expenditure remained below 2% of revenue, demonstrating our commitment to our capex-light model and preserving the financial flexibility to execute our capital allocation priorities.
We ended June with AED 2.4 billion in cash and a net cash position of AED 1.0 billion. Together with our AED 32.5 billion backlog, our strong financial position provides the visibility and capacity to deliver against our revised 2026 guidance. In that regard, we are pleased to announce AED 100 million interim dividend for our H1 2026 results, payable in October 2026.
Financial Overview
Revenue
ALEC recorded strong topline growth in H1 2026, with revenue reaching AED 9.0 billion, up 67.6% YoY, reflecting the ramp-up of major projects and increased activity across all operating segments.
Segmental Overview
- Building & Construction revenue more than doubled to AED 5.8 billion in H1 2026, increasing 105.6% YoY and remaining the Group’s largest revenue contributor. Growth was supported by the accelerated execution of major projects including Stargate Data Centre, Wynn Al Marjan Resort and the ilmi Science and Discovery Center. Gross profit margin improved by 47 basis points YoY to 7.0%, reflecting a more favourable project mix and the increasing contribution from more recent projects with higher margins.
In addition, Q2 2026 revenue increased 96.9% YoY to nearly AED 3.0 billion, while gross profit margin improved to 7.1% from 6.3% in Q2 2025.
- Energy Services revenue increased 36.9% YoYto AED 2.8 billion in H1 2026, as work advanced across client-related EPC contracts and the wider energy infrastructure portfolio. The segment recorded a gross loss of AED 157.5 million, yielding a negative gross margin of 5.7%, compared to a positive margin of 9.4% in H1 2025.
Q2 2026 revenue increased by 8.9% YoY to AED 1.3 billion, while the segment recorded a gross loss of AED 201.5 million and a negative gross margin of 16.1%, largely reflecting the recognition of fixed costs against disruptions related to regional geopolitical developments.
- Related Businesses generated revenue of AED 2.6 billion in H1 2026, an increase of 123.7% YoY, supported by greater integration, increased cross-selling and a higher contribution from internally generated work. Gross profit margin expanded by 80 basis points to 12.4% YoY.
Q2 2026 revenue increased 98.8% YoY to AED 1.3 billion, while gross profit margin improved to 12.1% from 11.2% in Q2 2025, reflecting accelerated delivery of specialist, value-added services across ALEC’s project portfolio. This included MEP and fit-out works at Wynn Al Marjan Island Resort and façade works at the ilmi Science Discovery and Innovation Center, alongside progress across other ongoing projects.
Profitability
Gross profit declined 4.4% YoY to AED 513.1 million in H1 2026, as higher contract costs from Energy Services more than offset strong revenue growth, resulting in a 430-basis point decline in gross profit margin to 5.7%.
Q2 2026 gross profit was AED 103.3 million, with the margin declining by 720 basis points YoY to 2.4%, primarily reflecting constrained activity within Energy Services and higher costs associated with regional disruptions.
H1 2026 EBITDA increased 2.7% YoY to AED 440.4 million, with EBITDA margin at 4.9% compared with 8.0% in H1 2025.
Q2 2026 EBITDA was AED 78.5 million, down 65.3% YoY, with the margin narrowing to 1.8% from 7.8% in Q2 2025. The decline primarily reflected costs recognised during the quarter within Energy Services in connection with regional geopolitical developments, rather than a broader expansion of the underlying cost base. Administrative expenses increased 1.7% YoY, well below revenue growth of 51.3%, reflecting ALEC’s measured approach to scaling overheads.
Net Profit for the half posted a decline of 10.5% YoY to AED 213.8 million, representing a Net Profit margin of 2.4%, down from 4.5% in H1 2025. The decline primarily reflected lower operating profit following operational disruptions within Energy Services. Higher income tax expense following the implementation of OECD Pillar II rules in certain jurisdictions during the period also weighed on net profit, while a relatively stable overhead cost and higher finance and other income provided a partial offset.
Q2 2026 recorded a Net Loss of AED 16.6 million, compared with Net Profit of AED 124.5 million in Q2 2025, as regional developments negatively impacted the profitability of the Energy Services segment, partially offset by lower overhead and lower finance costs, higher finance and other income, and an income tax credit.
In line with the Company’s dividend policy, the Board of Directors approved an interim cash dividend of AED 100 million for H1 2026, payable in October 2026.
Balance Sheet Analysis
ALEC’s balance sheet continues to expand in line with the increased scale of operations, with total assets rising 15.3% to AED 12.2 billion as at 30 June 2026, from AED 10.6 billion at year-end 2025.
Net working capital increased to AED 1.1 billion as at 30 June 2026, from AED 856.2 million at year-end 2025, and represented 6.9% of trailing-twelve-month revenue. The movement primarily reflected higher contract and other receivables and gross amounts due from customers on construction contracts, in line with increased project activity, partially offset by a corresponding rise in contract and other payables.
Cash and bank balances increased to AED 2.4 billion, from AED 1.6 billion at 31 December 2025, contributing to a net cash position of AED 1.0 billion and a net cash-to-trailing-twelve-month EBITDA ratio of 0.9x. The Group’s low leverage and healthy liquidity continue to provide financial flexibility and support the resilience of the business.
