KUALA LUMPUR (Nov 22): Dayang Enterprise Holdings Bhd saw its net profit for the third quarter ended Sept 30, 2019 (3QFY19) soar nearly 120% to RM107.1 million from RM48.75 million a year ago, mainly due to wider profit margin on work orders received and performed in the quarter under review.
This is the first time ever that it has registered quarterly profit in excess of RM100 million throughout the company’s history, according to the oil & gas player.
“This impressive achievement comes on the back of the robust work orders for the Maintenance, Construction and Modifications Contract (MCM) and Topside Maintenance Services works under the Pan Hook-up and Commissioning Contract (Pan HUC).
“Consequently, vessel utilisation at Perdana also came in much stronger at 91% compared with 79% in the second quarter and 36% in the first quarter of 2019,” it added.
Earnings per share expanded to 11.1 sen in 3QFY19 from 5.05 sen, according to the oil and gas player’s filing with Bursa Malaysia.
Quarterly revenue climbed 26.8% to RM357.58 million from RM281.93 million last year, mainly due to higher vessel utilisation and higher work orders received and performed under the topside maintenance contracts.
In the filing, the company said pre-tax profit shot up to RM151.6 million in 3QFY19 versus RM67.74 million a year ago. The big leap in pre-tax profit was partly due to a one-off gain on bargain purchase of RM10.6 million arising from the acquisition of a new subsidiary in July 2019, amortization expenses of RM3.1 million and net realised/unrealised foreign exchange gain of RM14.2 million, among others.
For its nine-month period, the company said its net profit jumped almost 138% to RM158.05 million from RM66.5 million. Cumulative revenue grew 16.7% to RM761.16 million versus RM651.99 million.
On prospects, Dayang commented it is optimistic that the strong earnings trend will be sustainable, premised on its large order book estimated at RM2.5 billion, implying clear earnings visibility over the next three years.
Meanwhile, it is also optimistic that the group-wide debt restructuring will be successfully and comprehensively completed by the first quarter of 2020.
“Post-restructuring, Dayang will emerge stronger with optimal capital structure which will stand the group in good stead amid the recovery in the oil and gas sector.
“Coupled with the strong cash flow generation, our more efficient capital structure will set a solid foundation for our long-term prospects,” it added.
Shares price of Dayang dropped five sen or 2.36% to RM2.07, giving it a market capitalisation of RM2.11 billion. The counter saw some 5.46 million shares done.