KUALA LUMPUR (Nov 28): Wah Seong Corp Bhd’s net profit for the third quarter ended Sept 30, 2014 (3QFY14) jumped to RM30.31 million from RM4.28 million last year.

The improved in net profit was mainly driven by the better performance from oil and gas segment and industrial trading and services segment.

Quarterly revenue expanded to RM592.46 million, a 42.63% higher compared to RM415.37 million in 3QFY13.

Earnings per share (EPS) strengthen to 3.92 sen per share from 0.56 sen a share a year ago.

For the nine months ended Sept 30 (9MFY14), the group said its net profit ballooned to RM91 million, a 678% increase from RM11.7 million last year. Cumulative revenue climbed to RM1.73 billion, representing 35.2% grow from RM1.28 million for the same cumulative period last year.

In a filing with Bursa Malaysia today, Wah Seong said its oil & gas segment’s external revenue for the 3QFY14 and 9MFY14 were RM348.8 milion and RM952 milion respectively, compared with RM169.4 milion and RM460.7 milion last year. 

This improved earnings of the segment, according to the group is basicaly reflect the higher number of projects secured and executed in the periods under review.

Commenting on its renewable energy segment, the segment recorded external revenue for the 3QFY14 and 9MFY14 were RM78.4 million and RM246.1 million respectively, compared with RM80.8 million and RM250.3 million in the corresponding periods in 2013. 

“The marginal decreases in revenue and profit before taxation was due to a slowdown in oleo-chemical industries, which had resulted in lower number of projects being executed during the period under review,” it said.

The revenue for its industrial trading and services segment for the 3QFY14 and 9MFY14 stood at RM143.0 million and RM43.1 million respectively, against RM125.9 million and RM470.5 million in the corresponding periods in 2013. 

“The increase in revenue in the quarter was due to new projects being executed in the pipe manufacturing business of the segment while the decrease in revenue
for the nine months was due to a shift towards low volume high margin products in the trading operations,” it added.

The group said the improvements in profit before taxation for 3QFY14 was attributable to lower doubtful debt provision required compared to significant doubtful debts provisions recognised for the corresponding period in 2013.

Going forward, Wah Seong said its current order book amounted to RM1.4 billion comprising RM939.4 million for O&G segment, RM30.2 million for renewable energy and RM180.4 million for industrial trading and services. 

“This is expected to have a positive impact on the performance of the Group for the financial year ending Dec 31, 2014,” it added.

Wah Seong’s share price down three sen or 1.86% to close at RM1.58 today, translating into a market capitalisation of RM1.22 billion.