MISC 4Q profit dips on lower offshore contribution

PETALING JAYA: MISC Bhd expects the outlook for the upstream oil and gas sector to remain robust given the high oil prices, continued global oil demand and increased capital expenditure spending.

In a statement, the energy-related maritime solutions and services provider said the demand for floating production storage and offloading vessels (FPSOS) was expected to remain favourable, driven by a healthy number of project sanctions worldwide.

It added that its offshore business segment would selectively pursue new opportunities in the market while maintaining focus on executing current projects.

MISC noted that the segment’s existing portfolio of long-term contracts would continue to support its financial performance.

MISC’S net profit slid 2.7% to Rm627.3mil for the fourth quarter ended Dec 31, 2023 (4Q23) from Rm645mil in 4Q22, despite revenue increasing 2.5% to Rm4.3bil from Rm4.2bil.

It said the lower earnings for 4Q23 were mainly due to reduced profit in the offshore business segment from lower construction progress from the FPSO conversion and additional cost provisions recognised in the current quarter while the decrease in the gas assets and solutions segment’s operating profit was due to higher vessel operating costs in the current quarter.

The increase in 4Q23 revenue, on the other hand, was mainly due to higher revenue from new and ongoing projects for heavy engineering sub-segment and improved charter rates in gas assets and solutions segment.

For the full year, MISC’S net profit rose 16.5% to Rm2.1bil from Rm1.8bil in 2022 on the strong performance by both its gas assets and solutions and petroleum and product shipping segments as well as lower impairment.

Its revenue increased 2.9% to Rm14.3bil in 2023 from Rm13.9bil previously on higher income from new and ongoing projects in the marine and heavy engineering segment and improved freight rates in the petroleum and product shipping and gas assets and solutions segments.

Its board has approved the fourth tax-exempt dividend of 12 sen per share for the year under review.