DSI posts Dh3.2 billion in revenues for 2016
dubai — Drake & Scull International (DSI) has reported Dh3.2 billion in revenue for 2016, compared to Dh4.2 billion reported for 2015, with the group’s Q4 2016 revenue standing at Dh540 million.
Against the backdrop of the significant liquidity challenges in the regional construction sector, the groups’ results for 2016 were impacted by major revenue reversals, profit adjustments, cost overruns, and investment impairments, emanating primarily from several disputed legacy projects in the construction business in the KSA.
The net loss for 2016 was Dh787 million, compared to a net loss of Dh939 million reported for 2015. In the last quarter of the fiscal year 2016, the company undertook most of the revenue reversals and profit adjustments as negotiations with key distressed clients on several projects drew to closure.
DSI’s ongoing order backlog reached Dh8.1 billion as of December 31, 2016 and the total value of project awards secured in 2016 stood at Dh815 million. The UAE and the engineering business accounted for 23 per cent and 72 per cent of the backlog, respectively, reflecting the company’s strategic and ongoing focus on its home market and core engineering business.
Wael Allan, CEO of Drake & Scull International, said: “Today, we are announcing the initial steps to stabilise and turn around our business. The capital reduction
The capital reduction is an important milestone in our recapitalisation programme and is a strategic move to improve the balance sheet and capital structure Wael Allan, CEO Drake & Scull International
is an important milestone in our recapitalisation program and is a strategic move to improve the balance sheet and the capital structure. Tabarak Investment will add great support to the new management team and will assist the company on a number of financial and operational initiatives. The fresh capital will be earmarked to pursue our growth plans in the MEP sector and to shore-up our working capital.”
The company is also working on a turnaround strategy that includes operational & organisational restructuring, mandating PricewaterhouseCoopers in Q4, 2016 to assist the management on a number of business transformation & strategic initiatives.
— business@khaleejtimes.com