Dialog Group focuses on key long-term strategies
PETALING JAYA: Dialog Group Bhd will remain focused and steadfast in the pursuit of its key long-term strategies.
In a filing with Bursa Malaysia yesterday, the engineering services company said it remains confident that its business model is well structured to manage and sustain itself through periods of economic uncertainty, oil price volatility and currency movements.
“Moving forward, we will actively look for opportunities to increase our development and production services and assets, while incorporating new technologies to manage greenhouse gas emissions,” it said.
For its first quarter ended Sept 30, 2022, Dialog’s net profit dropped to Rm125.79mil from Rm128.82mil in the previous corresponding period, while revenue rose to Rm711.70mil from Rm505.45mil a year earlier.
Basic earnings per share stood at 2.23 sen, compared with 2.28 sen previously.
During the quarter, Dialog said it saw increased activities contributed by both Malaysia and international operations.
“The Malaysian downstream team remained busy with various engineering, construction, fabrication and plant maintenance projects.
“These projects are currently on-going, however they are facing unprecedented challenges due to the Covid-19 pandemic, conflict in Ukraine, inflationary pressure and manpower constraints.”
Dialog said these unexpected circumstances caused severe supply chain disruption, higher material price and labour cost.
“Despite these challenges, the group’s main priority was to complete and deliver the committed projects.
“These had inevitably resulted in cost overruns and some project losses. Discussions are currently ongoing with our clients for reimbursement and compensation for these project overruns caused by these challenges.”
In the midstream business, the company said its Dialog Terminals Langsat and Dialog Terminals Pengerang (5), with a total capacity of 855,000 cubic metres and 430,000 cubic metres, respectively, continued to contribute a stable revenue stream to the group.
“The profit contributions from these terminals for the current financial quarter were lower due to the higher financing cost.
“The upstream activities also contributed a lower net profit in the current financial quarter resulting from lower production at both Bayan and D35/D21/J4 fields due to drilling and maintenance activities.”
On the international front, Dialog said it reported higher revenue for the current financial quarter, with higher sales of specialist products and services in various countries.
“However, the net profit after tax was lower because of the challenging environment.
“During the current financial quarter, the group has successfully completed the acquisition of a joint venture, Pan Orient Energy (Siam) Ltd, a concessionaire and operator of Concession L53/48, onshore Thailand. This has contributed to a higher share of joint ventures results to the group.”
As the economic environment is expected to remain extremely challenging in the short to medium-term, Dialog said it will continue to build and strengthen its competencies by investing and multi-skilling its workforce to ensure it remains efficient and competitive.
“Alongside the investment in our people is also our investment in technology. Dialog has long leveraged technology to differentiate ourselves from our competitors.
“In this regard, our ongoing digital transformation initiatives have been progressing well and we will continue the initiatives to reinforce our competitiveness.”