MISC pre-tax profit falls 60 pct to RM558.7 mln in 2Q

KUALA LUMPUR: MISC Bhd’s pre-tax profit for the second quarter ended June 30, 2017 of MISC Bhd fell by 60 per cent to RM558.7 million compared with RM1.37 billion in the same quarter last year.

Its revenue slipped to RM2.3 billion from RM2.39 billion previously, it said in a filing to Bursa Malaysia yesterday.

The energy-related maritime solutions and services provider said its petroleum business segment suffered an operating loss of RM20.1 million, compared to the corresponding quarter’s profit of RM58 million due to lower revenue and higher bunker costs in the current quarter.

Its offshore and heavy engineering segments also registered operating loss for the quarter.

MISC’s liquefied natural gas (LNG) segment, however, posted an operating profit of RM557.7 million, RM306 million higher than the corresponding quarter’s profit of RM251.7 million, mainly due to recognition of compensation for the early termination of a time charter contract and lease commencement of two new vessels.

For the current six months period, pre-tax profit decreased to RM1.255 billion from RM2.15 billion recorded in the previous six months ended June 30, 2016.

However, revenue was higher at RM5.28 billion versus RM4.78 billion previously.

On outlook, MISC said, the LNG shipping market continued to be affected by new-build deliveries and expiry of older vessel charters, which has depressed spot rates.

“However, this will have limited impact on the steady performance of the group’s LNG business segment due to its present portfolio of long term charters in place.

“As the oil market re-balances, a more stable oil price environment will pave the way for a gradual recovery in global offshore oil and gas investment,” it said.

It said the financial performance of its offshore segment would continue to remain stable due to long term contracts in hand despite the present limited opportunities.

In the heavy engineering segment, MISC said, it would focus on diversifying into new revenue streams while continuing its efforts to replenish the order book.

“At the same time, cost management, resource optimisation and operational efficiency would remain an ongoing priority.

“While heavy engineering has successfully secured several contracts during the period, the impact may not be seen immediately and majority of the contribution will only be realised in 2018 and beyond,” it said. — Bernama

On outlook, MISC said, the LNG shipping market continued to be affected by new-build deliveries and expiry of older vessel charters, which has depressed spot rates.