The energy company had been involved in legal battles over its $700 million Islamic bond
Dana Gas Q2 net profit drops 17% on sukuk restructure costs
Dana Gas, the energy company based out of Sharjah, has posted a 17 per cent decrease in second quarter net profit, largely due to costs associated with the restructuring of its $700 million (Dh2.57 billion) sukuk, which was at the heart of a long legal battle.
Net profit for the period fell to $10m from $12m. The company said in its disclosure to the Abu Dhabi Securities Exchange, where its shares are traded, that net profit for the period had seen a 200 per cent rise to $36m, if the one-off restructure costs were excluded.
The company has seen a 50 per cent reduction in sukuk profit rate to 4 per cent, thereby reducing annual debt service costs by an estimated 63 per cent, it said in a statement.
“The reduction in the sukuk profit rate will improve the company’s financial position and ability to fund future dividends,” said Dana Gas chief executive Patrick Allman-Ward.
“In the KRG [Kurdistan Region of Iraq] … we are on track with our debottlenecking project, which is expected to increase production by 25 per cent in Q3, and under way with our larger expansion programme, which will deliver a production increase of 170 per cent by 2021,” he said.