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14 August 2017
Dubai-based contracting company Drake & Scull International PJSC (DSI) has terminated the services of its chief executive, Wael Allan, it was announced on Monday.
The company said in a statement to the Dubai Financial Market its board had taken the decision to remove Allan during its meeting to review and approve its second quarter audited accounts, which showed that losses narrowed by 12 percent year-on-year to 182.7 million UAE dirhams ($49.74 million), despite contract revenue declining 18 percent to 660.3 million UAE dirhams during the quarter. It did not give a reason for its decision. Allan was not immediately available for comment.
Allan had only been in charge of DSI for nine months. A former head of Arcadis's Middle East operations, he was brought in to lead a turnaround of the company in October last year. This involved bringing in Tabarak Investment to inject new capital into the business following a proposed share capital reduction that will see three-quarters of its share base cancelled with a view to extinguishing 1.7 billion UAE dirhams worth of historic losses.
Allan had replaced DSl's longstanding chief executive and executive vice chairman Khaldoun Tabari. DSI's statement said it has also approved the resignation of Tabari, who recently sold his stake in the company to Tabarak Investment, and several other members of its board.
The company said that its capital restructuring plans are on track, and that it expects capital reduction to complete by the end of the third quarter of 2017. Following this, Tabarak Investment will subscribe to 500 million UAE dirhams worth of new shares, which will make it a majority shareholder in the company.
It said that Tabarak Investment, which is already the biggest single shareholder in Drake & Scull, had reaffirmed its commitment to the business, extending a 100 million UAE dirham interest-free loan to the company - a move which was announced last week.
Acting chief financial officer Feras Kalthoum, who joined the business in June this year, said that its second quarter results "should be viewed within the context of our turnaround plan and the capital restructuring programme and are consistent with our financial targets set out at the outset of the fiscal year".
“Our efforts to complete the capital and debt restructuring of the group, coupled with continued balancing of our portfolio to mitigate any contingent exposure that may impact our future profitability will soon reflect positively on our financial performance and top-line targets,” he said.
Mohammed Atatreh, a board member of DSl, added: “Our efforts to streamline our operations and restore our financial position will enable us to set solid foundation for sustainable growth.
“The continued support of Tabarak Investment has enabled us to maintain good progress year to date, keeping us on track to set up the group for growth in 2018 and beyond."
A note accompanying the company's accounts statement by its auditor, PwC, states that after reporting a loss of almost 1.04 billion UAE dirhams during the first six months of 2017, Drake & Scull's current liabilities outweigh its current assets by just over one billion UAE dirhams.
Accounts show that the company's net equity has declined to 217.6 million by the end of June, down from 1.25 billion UAE dirhams at the end of last year.
© Zawya 2017
Dubai-based contracting company Drake & Scull International PJSC (DSI) has terminated the services of its chief executive, Wael Allan, it was announced on Monday.
The company said in a statement to the Dubai Financial Market its board had taken the decision to remove Allan during its meeting to review and approve its second quarter audited accounts, which showed that losses narrowed by 12 percent year-on-year to 182.7 million UAE dirhams ($49.74 million), despite contract revenue declining 18 percent to 660.3 million UAE dirhams during the quarter. It did not give a reason for its decision. Allan was not immediately available for comment.
Allan had only been in charge of DSI for nine months. A former head of Arcadis's Middle East operations, he was brought in to lead a turnaround of the company in October last year. This involved bringing in Tabarak Investment to inject new capital into the business following a proposed share capital reduction that will see three-quarters of its share base cancelled with a view to extinguishing 1.7 billion UAE dirhams worth of historic losses.
Allan had replaced DSl's longstanding chief executive and executive vice chairman Khaldoun Tabari. DSI's statement said it has also approved the resignation of Tabari, who recently sold his stake in the company to Tabarak Investment, and several other members of its board.
The company said that its capital restructuring plans are on track, and that it expects capital reduction to complete by the end of the third quarter of 2017. Following this, Tabarak Investment will subscribe to 500 million UAE dirhams worth of new shares, which will make it a majority shareholder in the company.
It said that Tabarak Investment, which is already the biggest single shareholder in Drake & Scull, had reaffirmed its commitment to the business, extending a 100 million UAE dirham interest-free loan to the company - a move which was announced last week.
Acting chief financial officer Feras Kalthoum, who joined the business in June this year, said that its second quarter results "should be viewed within the context of our turnaround plan and the capital restructuring programme and are consistent with our financial targets set out at the outset of the fiscal year".
“Our efforts to complete the capital and debt restructuring of the group, coupled with continued balancing of our portfolio to mitigate any contingent exposure that may impact our future profitability will soon reflect positively on our financial performance and top-line targets,” he said.
Mohammed Atatreh, a board member of DSl, added: “Our efforts to streamline our operations and restore our financial position will enable us to set solid foundation for sustainable growth.
“The continued support of Tabarak Investment has enabled us to maintain good progress year to date, keeping us on track to set up the group for growth in 2018 and beyond."
A note accompanying the company's accounts statement by its auditor, PwC, states that after reporting a loss of almost 1.04 billion UAE dirhams during the first six months of 2017, Drake & Scull's current liabilities outweigh its current assets by just over one billion UAE dirhams.
Accounts show that the company's net equity has declined to 217.6 million by the end of June, down from 1.25 billion UAE dirhams at the end of last year.
© Zawya 2017
