ALEC Holdings (ALEC) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue reached AED 4.609 billion, up 87% year-over-year, driven by strong project execution in UAE and KSA and robust construction activity.

• Net profit more than doubled to AED 231 million, reflecting higher operating earnings and strong leverage despite increased finance costs and tax expense.

• Backlog stood at AED 26.7 billion, providing 1.8x trailing twelve-month revenue coverage and multi-year visibility.

• Major project milestones included the opening of Aquarabia in KSA and delivery of W Riyadh KAFD.

• A cash dividend of AED 250 million was declared and paid in April 2026.

Financial highlights

• EBITDA reached AED 362 million, up 79% year-over-year; EBITDA margin at 7.9%, down from 8.2% in Q1 2025.

• Gross profit for Q1 2026 was AED 410 million, with gross margin at 8.9%, down from 10.5% year-over-year due to prudent accounting for geopolitical impacts.

• Net profit margin improved to 5.0%, up from 4.6% year-over-year.

• Free cash flow to firm was negative AED 495 million, reflecting seasonal working capital outflows.

• Total assets increased to AED 11.5 billion, with net cash position of AED 122 million and net cash/EBITDA ratio of 0.1x.

Outlook and guidance

• FY 2026 revenue fully covered by backlog; management guides for 50-55% revenue growth and medium-term CAGR of 7-8%.

• Gross profit margin expected at ~10.3%, EBITDA margin at ~8.5%.

• Capex to remain at 2.0-3.0% of revenue in FY 2026, declining to ~1.0% over the medium term.

• Dividend guidance of AED 500 million for FY 2026, payable in two tranches.

• 45% of AED 26.7 billion in unsatisfied contract obligations to be recognized as revenue in the remainder of 2026; the rest from 2027 to 2030.