Wah Seong 1Q net profit down 31% as revenue drops

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KUALA LUMPUR (May 13): Wah Seong Corp Bhd reported a 30.9% drop in first quarter net profit to RM20.2 million, from RM29.25 million a year earlier, following a fall in its revenue.

Earnings per share profit for the quarter ended March 31, 2019 stood at 2.62 sen compared with 3.78 sen previously, the group said in a filing to Bursa Malaysia.

Quarterly revenue dropped 13.8% to RM683.76 million, from RM792.83 million previously.

Wah Seong said there was a decrease in the external revenue from its oil and gas (O&G) segment from RM538.8 million to RM440.3 million, as a result of continued lower level of market activities in the Asia Pacific region.

However, the group observed a recent increase in tender preparatory activities among some O&G majors for a number of prospective projects.

"These are expected to be converted into firm bids in the near term, with awards taking place in the next six to 18 months," the group said.

Hence, Wah Seong said the outlook for the group is likely to improve in the course of the year.

The group said its current order book amounts to RM1.1 billion, comprising RM702.4 million in O&G, RM330.2 million in the renewable energy segment, and RM53.1 million in the industrial trading and services sector.

Wah Seong's share price slid 2 sen or 2.8% today to close at 70 sen for a market capitalisation of RM539.32 million.