The company said in a statement to the Dubai market today, Sunday, that its accumulated losses amount to 4.78 billion dirhams, which constitute 447 percent of its capital of 1071 million dirhams..
Drake & Scull added that the main reasons for reaching these accumulated losses are provisions on projects in progress, and contracts receivable in old projects in Saudi Arabia, Qatar, Oman, India and the UAE, and they were kept in the balance sheet despite the reservations of the external auditor since 2016 on the possibility of recovery, in addition to writing off the entire value of goodwill on December 31, 2018.
She noted that project delivery costs far exceeded budgets; As a result of the poor performance, as many guarantees were liquidated, which increased the accumulated losses, in addition to the unused labor costs due to the failure to win new projects resulting from the banking ban and judicial orders.
With regard to the measures that will be taken to address the accumulated losses, the company said that it intends to complete the restructuring process and the work plan, which includes focusing on writing off the majority of debts and increasing capital to win new projects..
And it will complete negotiations with banks and commercial creditors with the aim of reaching a settlement, in addition to enhancing productivity and operational efficiency, following up on legal cases, collecting their dues and reducing expenses to match its available resources..
وتحولت Drake & Scull Company to Profitability During 2020, versus losing it in 2019.
According to a company statement on the Dubai Financial Market website, the company achieved profits of 109.3 million dirhams by the end of 2020, compared to recording losses of 87 million dirhams during the same period in 2019.