Drake and Scull International’s recent restructuring is bearing fruits, as the mechanical, electrical, and plumbing (MEP) specialist announced a net profit of AED 5.9 million ($1.61 million) for the third quarter ending September 30.
The result reflected a significant turnaround and recovery as the company continued to progress after the restructuring process’s success.
Driven by higher activity in India, Romania, and Tunisia, revenue reached AED 21.5 million ($5.85 million) for the quarter, an increase of 13 per cent from AED 18.9 million ($5.15 million) in the same quarter last year.
Net profit of $1.61 million was a sharp improvement compared to a net loss of AED 34.9 million ($9.5 million) in Q3 2023.
With AED 3.75 billion ($1.02 billion) in liabilities written back as part of the restructuring, year-to-date profit for the first nine months of 2024 reached AED 3.8 billion ($1.03 billion), compared to AED 197.5 million ($53.78 million) loss in the same period last year.
Drake and Scull International (DSI) had announced the write-off of approximately AED 4 billion in losses last July, including AED 3.79 billion representing financial and commercial debts. The company successfully increased its capital by 150 per cent above the required level for restructuring, which led to enhanced liquidity and the provision of necessary bank guarantees to secure new projects. All this led to the resumption of trading its shares on the Dubai Financial Market (DFM) on May 29.
Through the restructuring, DSI has substantially reduced its financial obligations by converting a portion of its debt into Mandatory Convertible Sukuks (MCSs), enhancing liquidity and financial flexibility.
Sheikh Theyab bin Tahnoun bin Mohammad Al Nahyan, Chairman of the Board of Directors of DSI, commented: “The company’s results for the third quarter reflect the positive impact of the restructuring process and the effectiveness of our team and executive management. The progress we have made in reducing the debt burden and enhancing liquidity, coupled with the management’s continued implementation of resolute measures to control administrative and operational costs, has laid a solid foundation for future growth.”
The financial restructuring markedly strengthened DSI’s balance sheet, with total assets increasing to AED 715.6 million ($194.85 million), compared to AED 350.4 million ($95.4 million) at the end of 2023.
“Having completed the restructuring process, the company is looking forward to long-term financial stability, and aims to benefit from its revitalised balance sheet to seize new opportunities in the regional infrastructure and energy sectors,” added Sheikh Theyab.
“The company expects sustainable growth in revenues and revenue margins and continuous improvement in operations over the coming years, in line with its strategic growth objectives.”
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