Arabtec posted a 17 percent slide in net attributable profit to 134.5 million dirhams ($36.63 million) in the first three months of 2010, it said in a statement on Monday, compared with a profit of 161.2 million dirhams in the same period last year.
The profit excludes an unrealized loss of 1.7 million dirhams for the revaluation of available-for-sale financial assets during the period.
A Reuters poll of four analysts expected Arabtec to post net profit of 178.9 million dirhams for the period.
Executives at the firm were not immediately available for comment, although one regional analyst was more positive on the outlook for the company.
"The key reason [for the loss] was the sector-wide construction standstill between the two Dubai World statements in November and March," said Roy Cherry, vice president, research, at Shuaa Capital.
"We believe we will see weak results from other construction companies too as a result, however we expect Arabtec and other construction firms to be able to compensate for the shortfall in the coming three quarters."
The firm's shares were up 0.8 percent at 2.48 dirhams a share at 0608 GMT, in line with Dubai's bourse, which also rose 0.8 percent.
Arabtec said its board approved setting up Arabtec Egypt in partnership with Amer Group and discussed proposed investment opportunities in Pakistan.
It also approved increasing the capital of its unit Target Engineering Construction to 150 million dirhams from 70 million dirhams.
In April Arabtec and Aabar Investments called off their $1.7 billion agreement for Aabar to take over Arabtec, with analysts saying Arabtec no longer needed it with Dubai's debt repayment plan.
In April, Arabtec said it accepted Nakheel's debt repayment offer of cash and new debt.
Property prices have been under pressure since late last year, when the financial crisis and a slump in oil prices ended a six-year economic boom in the Gulf region.
The builder reported its first ever quarterly loss in the fourth quarter after a charge of about $80 million for bad debt.
Earlier in April, HSBC cut Arabtec to "underweight" from "neutral."
