Dialog earnings up on midstream operations

Downstream activities also help boost results in Q4

PETALING JAYA: Dialog Group Bhd’s net profit for its fourth quarter ended June 30 rose 11% to RM114.85mil from RM103.55mil in the previous corresponding period.

This was driven by better performance delivered by its midstream and downstream activities.

In a filing with Bursa Malaysia, the oil and gas contractor said revenue in the fourth quarter, however, dropped to RM607.13mil from RM968.95mil a year earlier.

For its financial year ended June 30, 2018 (FY18), Dialog’s net profit grew to RM510.37mil from RM370.64mil in the previous corresponding period.

Revenue dipped to RM3.1bil from RM3.39bil a year earlier.

Dialog said the year’s net profit included a RM65.6mil fair value gain arising from the acquisition and converting a jointly controlled entity into a wholly owned subsidiary in September 2017.

The group said the strong financial performance delivered in the current financial year was mainly contributed by the Malaysian operations.

“The local operations saw better performances delivered by the midstream and downstream activities – in particular from its engineering, construction and plant maintenance services performed in various projects.

“In addition, the group’s financial performance for the current financial year included the consolidation of Langsat Terminals’ results, as they became subsidiaries in September 2017,” it added.

Dialog said upstream activities also contributed to the better performance, following the higher oil prices during the financial year under review.

“The increase in the group’s share of joint ventures and associates’ net profits for the current financial year was mainly contributed by its associate company, Pengerang LNG (Two) Sdn Bhd,” it said.

Pengerang LNG (Two) commenced commercial operations and received the first commercial liquefied natural gas cargo at its newly-commissioned regasification terminal at the Pengerang Deepwater Terminal in November 2017.

“On the international front, the lower net profit contributions in the current financial year were mainly due to reduced engineering, construction and plant maintenance activities.

“This drop was partially offset by the increased activities at the Jubail Supply Base, Saudi Arabia,” it added.

Moving forward, Dialog said it would continue to grow its core businesses with recurring income, especially in expanding its logistics business, which includes storage tank terminals.

“Barring any unforeseen circumstances, the group is optimistic that its performance would remain strong in FY19.”

Separately, Dialog said the ongoing operations of the 1.3 million cubic meter Pengerang Deepwater Terminal Phase 1 is currently being expanded by an additional 430,000 cubic meters.

“The construction of Phase 2 is partially completed and full completion is scheduled in early 2019,” it said.

Dialog said Phase 3 would be developed on approximately 300 acres of land located next to Phase 2, within the Pengerang Deepwater Terminal, with an indicative initial investment of RM2.5bil.

“The land reclamation activities have started and we are in discussions with potential customers for Phase 3,” it said.