Contractor DSI swings to profit but auditor highlights $1.3bn in accumulated losses

DUBAI: Contractor Drake & Scull said it swung to a profit of 95 million dirhams ($25.9 million) last year after losing 87 million dirhams the year before.
But auditor EY highlighted the UAE-based company’s accumulated losses of 4.9 billion dirhams ($1.3 billion), liabilities that exceeded assets by 4.1 billion dirhams and negative cash flow in 2020 of 104 million dirhams.
These figures “cast significant doubt about the Group’s ability to continue as a going concern,” EY said in a statement accompanying the earnings, which were released to the Dubai Financial Market on Thursday.
EY also raised a number of issues with Drake & Scull’s accounts, including being unable to determine opening balances for the beginning of 2020 after refusing to sign off on its 2019 accounts due to “significant and pervasive” audit issues.
“Looking ahead, our main focus will be to restructure our debt and equity for which a comprehensive plan is in progress,” the company said in a statement accompanying the results.
Drake & Scull presented a restructuring plan to creditors at the beginning of March and will hold a vote on its implementation at the end of April.