KUALA LUMPUR (Feb 25): Wah Seong Corp Bhd has reported its first loss-making quarter in two years as contributions from its oil and gas, and renewable energy segments declined, while its industrial trading and services business sank into losses.

It posted a net loss of RM9.98 million or 1.29 sen per share for the fourth quarter ended Dec 31, 2018 (4QFY18) against a net profit of RM65.96 million or 8.54 sen per share in the corresponding period last year. Revenue declined 27.86% to RM706.37 million from RM979.2 million, its stock exchange filing today showed.

The company said its oil and gas segment's profit before tax declined to RM6.9 million from RM64 million during the quarter. Excluding one-off items arising from the gain on sales and leaseback of land offset by impairment of certain idle assets, the segment would record a PBT of RM36.6 million.

Its renewable energy's PBT retreated to RM7.3 million from RM12.1 million due to compression in profit margins on revenue from equipment fabrication and steam turbines' business.

Its industrial trading and services segment recorded a loss before tax (LBT) of RM2.9 million versus a PBT of RM0.4 million a year ago, due to lower profit margins and higher expenses in the construction equipment and power generation businesses, as well as its building materials business.

For the full year ended Dec 31 (FY18), its net profit was down 42.67% to RM64.8 million or 8.39 sen per share from RM113.02 million or 14.63 sen per share in FY17, despite revenue climbing 18.82% to RM2.96 billion from RM2.49 billion.

This is as its O&G segment's PBT declined to RM105.8 million from RM132 million a year ago, which was partly mitigated by the marginally higher PBT of RM30.7 million versus RM29.5 million in the RE segment, and the PBT of RM7.1 million versus an LBT of RM0.5 million in its industrial trading and services segment.

On prospects, Wah Seong said the outlook for profits should improve in the course of the year, as it is seeing an upturn in tendering as well as preparatory activities by oil and gas majors for a number of prospective projects, which are expected to convert into firm bids in the near term with awards taking place in the next 6 to 18 months.

It said its order book now stands at RM1.1 billion, comprising RM774.2 million in the oil and gas segment, RM283.3 million in the renewable energy segment, and RM54.4 million in the industrial trading and services segment.

Wah Seong shares closed 2.5 sen or 2.84% higher at 90.5 sen today, giving it a market value of RM697.27 million. Over the past 12 months, the counter has declined nearly 46% from RM1.67.