Speedy Hire is making “good progress” in withdrawing its general hire and spot-rentals business in the Middle East following a major accountancy fraud discovered in 2013, the UK-based group said in its half-year results.
The company previously announced it would discontinue general rental services in the region in a bid to “stem losses and build value in the remaining oil and gas services business,” following the fraud at its Middle East division.
The cost to the UK-based company of what it described as “accounting irregularities” was $7.4m, plus additional expenses.
Following a review of its Middle East business, Speedy previously announced that “continued under-performance of the business is primarily the result of a legacy cost base and weak demand for general and spot hire”.
The company said it would exit the spot rental market by the end of Q1 FY 2016, or earlier if possible, and dispose of assets or return them to the UK.
Speedy has decided to concentrate on its long-term oil and gas services contracts, including a five year, $50 million contract to support ESNAAD, the support services arm of Abu Dhabi National Oil Company, in relation to the Zakum Development Company’s (ZADCO) artificial islands project in Abu Dhabi, which was announced in 2012.