Revenue – AED321mn, -27.0% Y-o-Y, -29.0% Q-o-Q, -26.9% vs. EFGe Gross profit – AED51mn, -10.2% Y-o-Y, 4Q15: AED0.2mn in gross loss Net profit – AED9mn, vs. net profit of AED15mn in 1Q15, AED259mn in net loss in 4Q15, EFGe: AED4mn   DEPA Limited (DEPA) reported its headline figures for 1Q16, which overall was a good quarter, with the weakness in revenue seen as the only major disappointment. Gross profit margin surprised positively at 16%, but we do not believe this is sustainable. Net income beat estimate, recovering from the net losses reported last quarter. Moreover, awards were adequate and DEPA’s net cash balance grew.   While the market conditions, particularly in the MENA region, are still challenging, management has indicated that it has conservatively adjusted for the troubled projects and accounts last year, aiming to start the year with a cleaner balance sheet. However, given the sector’s latest trends, we do not exclude the possibility of booking further provisions, especially in light of the challenging operating environment. We have a Neutral rating on the stock. DEPA trades at an EV/EBITDA of 11.4x in 2016e, 7.0x in 2017e.     Main positives: i) Adequate awards, which we estimate at cAED320mn (undisclosed in the release, roughly unchanged Y-o-Y, albeit down from AED434mn in 4Q15). Backlog is roughly unchanged Q-o-Q and up 10% Y-o-Y to AED2.16bn; ii) Gross profit margin of 16%, up 300bps Y-o-Y and recovering from the red in 4Q15, which was pressured by adjustments from cost overruns; iii)Net income beat estimate, coming in at AED9mn, and recovering from the losses booked last quarter; albeit down Y-o-Y from AED15.0mn; iv) Net cash position up, reaching AED143mn in March (December 2015: AED125mn, March 2015: AED135mn) Main negative: Weak revenue, indicating possible slowdown in execution. (Mai Attia, Sara Boutros, Company disclosure)   Depa Limited (DU): USD0.37 as of 24 May 2016, Rating: Neutral, FV: USD0.41/share, MCap: USD230 mn, DEPA DU / DEPA.DI