Drake & Scull is putting together the small wins as it starts on a masisve restructuring project. It will get back on dfm from May 21. Image Credit: Supplied

Dubai: The Dubai engineering firm Drake & Scull confirmed revenues of Dh31 million for the first three months of 2024 as it counts down to May 21, which will see its stock get back on DFM for the first time since November 2018. The gross profit for the period came to Dh1.3 million.

The company still reported a net loss for Q1, at Dh46 million from Dh119 million a year ago. But the company is not unduly worried about this particular outcome. "The main reason behind Q1-2024 loss was the net financing cost of Dh39 million that will be reversed back in the accounting books back upon successful completion of the restructuring process," the statement said.

Drake & Scull still has accumulated losses of Dh5 billion plus, but it now has the space to turn itself around through a deal struck with lenders and creditors. Plus, on another front, the Group is making headway - with a project backlog of Dh589 million compared to Dh435 million as of end of 2023. This was 'driven by ongoing operations in overseas countries'.

Financial restructuring

Drake & Scull is also seeking a capital boost via offering new shares. "We are glad to announce that the restructuring process is expected to be completed soon - and the new IPO subscription which is limited to our existing shareholders only already started on 25 April 2024 and would be closed on 10 May 2024," said a spokesperson.

"We have full trust in all our existing shareholders to subscribe in the new capital raise and the new funds will be utilized in improving the efficiency and effectiveness of the working capital necessary to win new profitable projects in UAE and overseas countries in the future."

The Q1-24 statement would be the company's last before closing the restructuring process. "Once the process is completed, the liabilities related to the restructuring plan creditors will be reversed back in the accounting books based on 90 per cent write off and 10 per cent non-bearing interest Mandatory Convertible Sukuk," said the spokesperson. This is as per the settlement plan approved by the Dubai Court of Appeal on November 1, 2023.

Taking on legacy losses
"Dealing with the accumulated losses is totally dependent on the successful completion of the restructuring plan that was approved by all concerned parties, including banks, creditors and shareholders, in addition to government authorities..."

- Drake & Scull International

More to follow...