Thursday 28 Mar 2024
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KUALA LUMPUR (Feb 9): Dialog Group Bhd posted a 20% year-on-year increase in its second quarter net profit ended Dec 31, 2014 (2QFY15), at RM79.75 million or 1.62 sen a share.

This was achieved despite 2QFY15 revenue having come in 17.84% lower at RM570.29 million, as compared with RM694.16 million the previous year.

While there was higher revenue recorded from the upstream activities, Dialog (fundamental score: 1.70; valuation score: 0.70) explained that the completion of the Pengerang Deepwater Terminals Phase 1A and 1B during the last financial year, had resulted in lower engineering and construction activities in the current reporting quarter, hence translating into overall lower revenue.

Additionally, international revenue for 2QFY15 had reduced by 19% against the same period last year.

“This was mainly attributable to low activities in engineering and construction in Singapore, fabrication in Australia and New Zealand, and lower sales of specialist products and services in India and Brunei,” it added.

Nevertheless, the higher profit was attributable to better margin registered by the upstream activities in Malaysia, and a gain on the disposal of the group’s other investment, said Dialog.

For the six months ended Dec 31, 2014, Dialog’s net profit came in 13.65% higher at RM129.65 million, while revenue dipped 12.43% to RM1.11 billion.

On the brighter side, the group said falling oil prices would lower the overall costs of processing, manufacturing and production of a wide range of petroleum and petrochemical products.

“This would have a positive impact on the midstream and downstream sectors of oil and gas industry,” said Dialog.

Meanwhile, the demand for storage facilities is also expected to increase, while further development of the Pengerang Deepwater Terminal will provide opportunities for the group’s engineering and construction services, the group added.

Dialog noted it is now working towards securing new potential partners for the subsequent phases of Pengerang Deepwater Terminal, which include the development of more petroleum, petrochemical and LNG storage terminals.

“Barring unforeseen circumstances, the group is confident to continue to deliver a healthy performance for the financial year ending June 30, 2015.”

Dialog closed 4 sen or 2.41% higher at RM1.70 today, giving it a market capitalization of RM8.33 billion.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)

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