x Abu Dhabi, UAEMonday 24 July 2017

Renaissance stock falls again

Market Wrap: Omani shares lead big losses yesterday after Renaissance Services, an oil services company said it discovered fraud at its Dubai-based Topaz unit and first half profits dropped 77 per cent.

Fraud was discovered at Renaissance Services's Topaz unit. Photo courtesy Topaz Energy
Fraud was discovered at Renaissance Services's Topaz unit. Photo courtesy Topaz Energy

Renaissance Services dropped 10 per cent for a second day after the oil services provider said it discovered fraud at its Topaz unit on Monday and first-half profits dropped 77 per cent.

The shares tumbled to 0.559 rial, the lowest level since April 2009. The stock has slumped about 20 per cent in the past two days, the biggest decline on record.

After the two-day drop, Renaissance said the "investigation into these matters, has so far centred on US$2.9 million of cash over a six-and-a-half year period, of which a portion appears to be connected with fraud or misappropriation. "Without diminishing the seriousness we attach to any matters of this kind, this should be seen in context of materiality of a business that has generated revenues in excess of $3.5 billion over that same period."

The violations have been identified and stopped, and perceived control weaknesses have been strengthened to ensure prevention of future repetition, the company said.

Oman's index was down 0.4 per cent to 5454.60 points.

The Dubai Financial Market General Index slipped 0.2 per cent to 1,466.50 points. The Abu Dhabi Securities Exchange General Index was down 0.5 per cent to 2,585.80 points.

Elsewhere in the region, Bahrain's index was little changed at 1,266.22 points and Qatar's benchmark added 0.2 per cent to 8,137. The Saudi Tadawul All-Share Index was down 1.3 per cent to 6,053.72.

halsayegh@thenational.ae