Depa Annual Report 2012
Financial Highlights Continued Bad-Debt provisions Provision for bad debts is one of the major components of loss for the year as we took prudent stance on our receivables on certain projects where there is recoverability risk and recorded provisions of AED 125.5 million in year 2012. The major provisions recorded during the year are on NDIA Project in Qatar and on Port Baku and JW Marriott projects in Azerbaijan. Cash Position FY2012 was a challenging year for the Company in terms of liquidity management as there were many unforeseen circumstances, primarily encashment of bonds worth AED 215 million, having an adverse effect on our cash reserves. These bond encashments, combined with significant delays in receiving advance payments and collections on some of our major projects, put a lot of pressure on our operating cash flows in FY2012. Despite all these challenges, we managed to ensure that we met all our financial obligations on time. Although we used AED 25 million of cash in managing the operations, we ended the year with positive net cash of AED 8 million compared with a negative net cash of AED 36 million at the end of Q3 2012. This improvement of AED 44 million in the last quarter strongly reflects on our ability to generate cash and we were able to close the year on a positive note.
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