Thursday 28 Mar 2024
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KUALA LUMPUR (Nov 24): Wah Seong Corp Bhd’s net loss ballooned to RM255.83 million in its third quarter ended Sept 30, 2020 (3QFY20) from RM29.64 million in 2QFY20, despite an improvement in revenue, as the group recognised RM265.2 million worth of adjustments including impairments and provisions, due to the current challenging economic conditions.

Revenue for the quarter jumped 86% quarter-on-quarter to RM453.3 million from RM243.12 million, its stock exchange filing showed.

In contrast to 3QFY19, the group has sunk into the red from a net profit of RM15.29 million in 3QFY19, as revenue slumped 30% from RM644.49 million.

The one-off adjustments comprise of impairment of assets amounting to RM215.7 million, provisions and cost related to the shutdown of certain locations of RM33.3 million, and the reversal of deferred tax assets of RM16.2 million.

“Excluding the above one-off adjustments, the group would have made a profit after tax and minority interest of RM9.4 million for the current quarter, despite the group operating in a challenging environment,” Wah Seong said.

All its business segments improved q-o-q, led by a near three-fold revenue jump in its oil and gas (O&G) segment to RM221.7 million from RM78.1 million. Its renewable energy (RE) segment's revenue also grew 18% to RM98.6million from RM83.9 million, while its industrial trading and services business saw revenue doubling to RM89 million from RM44.6 million.

For the nine months ended Sept 30, the group recorded a net loss of RM329.89 million, versus a net profit of RM54.72 million a year ago, while revenue halved to RM1.02 billion from RM2.09 billion.

On prospects, the group said its current order book has increased by RM229.8 million to RM1.1 billion, comprising RM807.8 million in the O&G segment, RM259 million in the RE segment, and RM42.1 million in the industrial trading and services segment.

However, it said its outlook is unlikely to improve anytime soon, as "unfavourable political and economic climate has continued to persist".

The group, however, said it is taking advantage of the situation to re-examine its business set-up and restructure, and to streamline its systems and processes, in order to be better placed to meet any improvement in global and domestic demand when they return.

Wah Seong's shares slipped one sen or 2.15% to settle at 45.5 sen today, giving it a market capitalisation of RM352.31 million. The counter has lost 62% from when it was trading at RM1.19 on Jan 2.

Edited ByTan Choe Choe
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