Drake & Scull International recorded a net profit of Dh32 million for Q2, a stark contrast to the net loss reported in the same period last year. This improvement is largely attributed to the company’s strategic restructuring initiatives and a renewed focus on core operations. Revenue for the quarter stood at Dh717 million, a 3% decrease compared to the previous year, primarily due to lower productivity in key projects within Saudi Arabia and ongoing financial challenges, including acquisition costs and contract provisions.
The turnaround plan for Drake & Scull, which was approved by a Dubai court earlier this year, involves a comprehensive strategy to manage and reduce the company’s substantial debts. The company owes more than Dh3.8 billion to various creditors, including major banks like HSBC Middle East, ADCB, and Emirates NBD. The restructuring plan includes raising new equity and securing additional financing to stabilize operations and enhance profitability.
Drake & Scull’s Chief Financial Officer, Osama Hamdan, emphasized the focus on improving productivity and financial performance in the second half of the year. The company is also expanding into new sectors, including rail and oil & gas, which are expected to contribute to revenue growth in the coming months.
The successful implementation of this restructuring plan is critical for Drake & Scull as it seeks to rebuild its reputation and financial health. The company has set a 12-month timeframe to achieve its turnaround objectives, with the possibility of extensions based on the progress of the restructuring proceedings.
Drake & Scull’s efforts are closely monitored by industry analysts, who note the company’s potential for recovery amidst the challenges it faces. The successful turnaround of Drake & Scull would not only benefit the company but also have positive implications for the broader construction and engineering sectors in the UAE.
Overall, the latest financial results indicate a positive trajectory for Drake & Scull as it continues to navigate its way out of financial difficulties and towards a more stable and profitable future.