GEORGE TOWN: Oil and gas service provider Kejuruteraan Samudra Timur Bhd (KSTB) has exited Practice Note 17 (PN17) status, after Bursa Securities has approved its upliftment and considered it a cash company.

In a filing with Bursa Malaysia yesterday, KSTB said it is no longer considered a PN17 company.

"Bursa Securities has approved KSTB’s application to be declassified as a PN17 company, given that, among others, the company is considered a cash company pursuant to the Main Market listing requirements as of Feb 27, 2015, and that KSTB no longer triggers any of the criteria under Paragraph 2.1 of PN17 of the listing requirements,” it added.

The company will be declassified as a PN17 company, effective today.

It was classified under PN17 after disposing of Samudra Oil Services Sdn Bhd to Destini Bhd (fundamental: 1.7; valuation: 1.1) for RM80 million last year, leaving it without a core business.

For the nine months ended March 31, 2015 (9MFY15), KSTB posted a net profit of RM8.71 million from RM701,000 a year ago, while revenue improved to RM8.03 million from RM7.34 million for 9MFY14.

In May this year, the company warned that it expects FY15 to be even more challenging amid  the slump in crude oil prices, and is cautiously optimistic about the sustainability of the current level of its present operations.

KSTB (fundamental: 1.55; valuation: 2.4) shares rose 12.5% or six sen to close at 54 sen yesterday, with a market capitalisation of RM88.05 million.

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This article first appeared in The Edge Financial Daily, on July 21, 2015.