Dubai's Drake & Scull chases customers for $37m

Contractor confident of recovering money on three completed projects

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Drake & Scull CEO Khaldoun Tabari
Drake & Scull CEO Khaldoun Tabari

Drake & Scull has said that it has begun arbitration proceedings with customers who owe the company around AED: 135.3m ($36.8m) for work it has carried out. 

The company's newly-filed accounts for the second quarter of 2013 show that it is owed AED: 53m ($14.4m), AED: 36m ($9.8m) and AED: 41.3m ($11.2m) in balances on three contracts relating to "projects that were completed and already handed over to those customers".

Although it said the outcome of the arbitration process was "uncertain", it has not written down the value of the amounts owed to it on its balance sheet.

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"Management is of the opinion that the balances are fully recoverable," the company said in notes to accounts that were published on the Dubai Financial Market yesterday.

Accounts show that the company's cash balance also reduced by almost AED: 93m ($25.3m) as it gears up to deliver a significant new wave of work in the UAE, Saudi Arabia, Qatar, Jordan and Iraq, among other places.

By June 30, its net cash balance stood at AED: 126.8m ($34.5m), compared with AED: 219.7m ($59.8m) a year earlier.

In a statement announcing its first-half results last week, Drake & Scull said its backlog has grown to AED: 11.7bn ($3.18bn) buy June 30 - up 58% on the AED: 7.4bn ($2.08bn) in the pipeline at the same stage last year.

It also said first-half profits were up 54% to AED: 114.9m ($31.3m) on sales that increased by 71.8% during the same period to AED: 2.6bn ($700m).

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