Top

Depa Group reports Q1 loss as Asian subsidiary loses millions

Depa Group reports Q1 loss as Asian subsidiary loses millions

Singapore-based Design Studio Group's revenue dropped by more than 60% in the first quarter of 2019

Depa Group's projects include the five-star Mandarin Oriental Jumeirah hotel in Dubai.
Depa Group's projects include the five-star Mandarin Oriental Jumeirah hotel in Dubai.

Interior design and fit-out business Depa Group has slipped into the red for the first quarter of 2019, after Asian subsidiary Design Studio Group (DSG) made a loss.

Depa Group did not reveal how much of a loss it made during Q1 2019 in a trading update for the three months to 31 March – but it had earlier revealed DSG incurred a net loss after tax of $4.4m (AED16.4m) during the quarter.

DSG’s loss was blamed on its revenue plunging 62% after a delay in international projects, Depa Group said in a statement.

This financial performance contrasts with Depa Group’s other business units, such as Vedder, Depa Interiors, and Deco Group, which all generated profit in Q1 2019.

While this took some sting out of the loss, the key business units are lagging behind the revenue and earnings before interest and tax generated during Q1 2018.

Depa Group's backlog performed better, increasing by 13% to $582.1m (AED2.1bn).

Kevin Lewis is the acting group CEO of Depa.

On the ground in the Middle East, Depa Interiors completed an important but unnamed hospitality project in Dubai. It also picked up work on what Depa Group called a “prominent” social infrastructure project in Abu Dhabi, worth $13.6m (AED50m).

The company’s recently-appointed acting group CEO, Kevin Lewis, said efforts had already begun to return the interior design business to profitability.

“Three of Depa’s key business units made a steady start to 2019, with highlights including Depa Interiors successfully handing over a major project and some significant project wins for Depa Interiors and Deco Group,” he said.

“While DSG’s performance has continued to lag the rest of the group, its focus on driving efficiencies, productivity, and its improved backlog provide positive markers. However, our group-wide operational review is under way and where required swift action will be taken.”

Most Popular