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Quarterly Report For The Financial Period Ended 31 March 2017

Financials Archive

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Unaudited Condensed Consolidated Statement Of Profit Or Loss
For The Quarter And Year-To-Date Ended 31 March 2017

 Income Statement

Condensed Consolidated Statement Of Financial Position
As At 31 March 2017

Financial Position

Review of performance of the Company and its principal subsidiaries

Current quarter compared with corresponding quarter of the previous financial year (1Q 2017 Vs. 1Q 2016)

The Group's performance for the current quarter under review compared to 1Q 2016 is as follow:

Review of performance

For the quarter ended 31 March 2017, the Group recorded revenue of RM12.3 million reduced by 78% compared to corresponding quarter of the previous year.

Shipbuilding Division
The revenue of shipbuilding division decreased by RM38.1 million in 1Q 2017 compared to corresponding quarter of the previous year mainly due to sale of two (2) offshore support vessels in 1Q 2016.

Ship Charter Division
Revenue of ship charter division decreased by RM5.1 million or 30% compared to 1Q 2016 (RM17.2 million). The unfavourable variance was mainly due to drop in demand for vessels.

Review of performance

The Group recorded loss before tax of RM10.4 million in the current quarter against loss of RM8.0 million in the corresponding quarter of preceding year mainly arising from lower utilisation of vessels for charter and foreign exchange loss.

Commentary on prospects

With oil prices recovered from the low of USD28 per barrel to between USD48 to USD53 per barrel in recent months, the outlook seems to be improving in anticipation of a shipping recovery. However, due to excess capacity in vessels available, margins will remain tight. Contract tenures are mostly short term as oil companies has yet to increase the offshore exploration, seismic, drilling and production activities.

The Group will continue to redouble its efforts and commitment to deliver high value products and services with emphasis on safe operations and to maintain the Group's position as one of the leading integrated service providers in the offshore marine services segment. In addition to that, the Group will continue its emphasis on ship repair to diversify income stream.

Prospect on the industry will also improve with OPEC and Non OPEC members agree to extend the production curb. The Board is cautiously optimistic that demand for offshore support vessels will improve with increased expenditure in offshore oil field development and maintenance work by the oil majors. Internally, with the ongoing intiatives in costs rationalization we believe the Group is well positioned to tide over the current business challenges.

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