KUALA LUMPUR (May 14): Perisai Petroleum Teknologi Bhd was among the top actives on the exchange, after the company announced its results for the first quarter ended March 31, 2015 (1Q15).

At 10.42am, Perisai (fundamental: 0.65; valuation: 1.1) was down 0.5 sen at 54 sen, with some 12.3 million shares exchanged.

In a filing yesterday, the company posted net profit of RM7.03 million or 0.01 sen per share for 1Q15, a turnaround from its net loss of RM2.99 million in 1Q14.

The improvement in profit was on the back of a 422% spike in quarterly revenue to RM56.73 million, from RM10.87 million in the previous year, due to the commencement of drilling operations of its new jack-up drilling rig, Perisai Pacific 101, in August 2014.

Besides that, higher contribution from its joint ventures and associates and higher foreign exchange gain had also contributed to better results for the quarter, said Perisai.

Despite the year-on-year improvement in its performance, Kenanga Investment Bank Bhd, in a note today, was disappointed with the company’s performance, as 1Q15 net profit only accounted for 9% of its forecast.

The research house noted that while Perisai’s performance improved year-on-year, core net profit had plunged 28% quarter-on-quarter due to weaker revenue from the company’s drilling and marine divisions and higher interest cost.

Kenanga also highlighted that the company’s pipelay barge, Enterprise 3, is still without a contract, while the Rubicone mobile offshore production unit (MOPU) is expected to see better opportunity in 2H15.

“We believe it is unlikely for the group to secure any major contracts this year that can contribute significantly to FY15 earnings due to the still weak oil and gas (O&G) industry outlook,” the research house said.

Overall, Kenanga said Perisai’s earnings remain uncertain, due to the low visibility of contract awards in the near term, while its idle assets continue to burn cash and impact its bottomline.

Kenanga upgraded its call on Perisai to market perform from underperform, but had lowered its target price to 59 sen from 69 sen previously.

(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.)