Drake & Scull International

1. Company Overview & Earnings Context

Drake & Scull International P.J.S.C. (DSI) is a Dubai Financial Market (DFM)-listed engineering and construction company specializing in mechanical, electrical and plumbing (MEP) contracting, water and wastewater infrastructure, oil & gas projects and real estate development. During H1 2026, the Group continued its restructuring and turnaround journey, delivering strong revenue growth and returning to profitability. Revenue nearly doubled as project execution accelerated, while the company continued implementing its court-approved restructuring plan.

2. Financial Performance Snapshot

• Revenue: AED 154.18 Million (+97.9% YoY)

• Gross Profit: AED 16.37 Million (+175.8% YoY)

• Profit Before Tax (Continuing Operations): AED 10.88 Million (+26.6% YoY)

• Profit from Continuing Operations: AED 9.40 Million (+41.2% YoY)

• Net Profit: AED 9.03 Million (+38.2% YoY)

• Earnings Per Share (EPS): AED 0.003 (+50.0% YoY)

Compared with H1 2025:

• Revenue increased 97.9% to AED 154.18 million.

• Gross profit increased 175.8% to AED 16.37 million.

• Profit before tax from continuing operations increased 26.6% to AED 10.88 million.

• Profit from continuing operations increased 41.2% to AED 9.40 million.

• Net profit increased 38.2% to AED 9.03 million.

• Earnings per share increased from AED 0.002 to AED 0.003.

3. Operational Highlights & Key Metrics

• Total Assets: AED 580.84 Million

• Total Equity: AED 194.71 Million

• Cash & Bank Balances: AED 206.26 Million

• Trade & Other Receivables: AED 220.96 Million

• Development Property: AED 35.42 Million

• Contract Assets: AED 25.96 Million

• Trade & Other Payables: AED 136.76 Million

• Net Cash Used in Operating Activities: AED 15.84 Million

4. Key Performance Drivers

DSI's H1 2026 performance was driven by a sharp increase in revenue from ongoing project execution and a significant improvement in gross profitability. The Group also benefited from AED 39.47 million in other income, primarily from the write-back of liabilities and provisions under its restructuring process. However, results were partially impacted by a AED 25.15 million expected credit loss provision related to a receivable from an associate.

5. Outlook & Forward Guidance

Management continues to execute the Group's restructuring plan while focusing on new project opportunities and strengthening liquidity. Although the auditors highlighted a material uncertainty regarding the Group's ability to continue as a going concern due to accumulated losses exceeding 50% of share capital, management believes available liquidity and expected cash inflows from projects in the pipeline support the going concern assumption.

6. Investor Takeaway

Drake & Scull International delivered a notable turnaround in H1 2026, nearly doubling revenue and returning to profitability while continuing its restructuring journey. Despite ongoing financial and legal challenges, improving project execution, stronger gross margins and a healthier operating performance indicate that the company's recovery strategy is gaining momentum.