SuriaGroup registers drop in revenue

KOTA KINABALU: Suria Capital Holdings Berhad on Thursday announced SuriaGroup’s performance for the fourth quarter of 2023 (4QFY23) and the 12-month period ended 31 December 2023 (FY23).

In 4QFY23, the Group registered a total revenue of RM66.4 million, marking a decline of 33.5 per cent compared to RM99.9 million recorded in the same period of 2022 (4QFY22).

This decline is attributable to a non-recurring and noncash transaction finalised in 2022, involving carpark units provided as entitlement in kind to SuriaGroup by its property development partner for the Jesselton Quay (JQ) project.

The impact on revenue performance during this quarter is specifically linked to the oneoff nature of this transaction.

The port operations segment, managed under subsidiary Sabah Ports Sdn Bhd, remains as the major income contributor for the Group, accounting for 85 per cent of total revenue in 4QFY23.

Segmentally, the Ports’ operating revenue declined by 7.6 per cent in 4QFY23 amounting to RM64.5 million compared to RM69.8 million registered in the year ended December 31, 2022 (4QFY22).

Despite the lower revenue, there was a one per cent increase in cargo throughput (excluding containers) both at the wharf and at anchor, totaling 5.7 million metric tonnes in 4QFY23 compared to 5.6 million metric tonnes in 4QFY22.

Meanwhile, container volume moderated by one per cent from 110,182 Twenty-Foot Equivalent Units (TEUs) against 111,585 TEUs recorded in 4QFY22.

Correspondingly, the Group’s profit after tax declined by RM11.1 million compared to RM(2.0) million recorded in 4QFY23 and the previous year’s corresponding quarter’s amount of RM9.0 million.

For FY23, the total revenue of the Group registered at RM280.5 million, a decrease of RM21.4 million as against the revenue of RM301.9 million in the corresponding period of 2022.

As a result, the Group’s profit before tax dipped by 7.9 per cent in FY23 to RM49.3 million from RM53.5 million in FY22.

Overall, the quarterly and year-end performance of the Group were primarily impacted by a few significant events: the one-off nature of nonrecurring non-cash transaction in 2022, additional provision of replacement cost arising from a more vigorous review of asset replacement policy and adjustments in the amortisation of the Port’s concession assets.

Despite a mixed performance, the group’s overall fundamentals remain strong.

The Group maintains a positive outlook, particularly with regard to port-related projects and prospects in property development.

With the approaching completion of the twin jetty at Sapangar Bay Oil Terminal in Kota Kinabalu, the Group anticipates a significant boost in handling capacity through increased facilities to handle more than one vessel simultaneously.

Expected to be completed within April 2024, the project involves the construction of additional berths aimed at increasing efficiency and reducing vessel waiting time.

With the new jetty, there will be sufficient window to carry out major maintenance of the existing single-berth jetty which has been in operation since 1985.

The new oil jetty will contribute to long-term revenue growth, and the upgraded facilities position the terminal for promising prospects in the future.

Sabah Ports Sdn Bhd is poised for significant advances as it progresses with finalizing the strategic partnership with the world’s leading smart logistics solutions provider, DP World.

This strategic collaboration, entails establishing a joint venture in managing Sapangar Bay Container Port leveraging on DP World’s global expertise in managing ports and building supply chain networks to help optimise SBCP’s operations.

With the partnership and DP World’s expertise, the Port aims to establish a strategic link for shipping efficiency, thus opening opportunities for cargo generation and other high value logistics-related prospects which the Group may tap into.