UMW-OG posts RM53.7m net profit in 1Q

by **Cals** Wed 21 May 2014, 01:46

Business & Markets 2014

Written by Charles Yong of theedgemalaysia.com

Tuesday, 20 May 2014 10:29

KUALA LUMPUR: UMW Oil & Gas Corp Bhd (UMW-OG) recorded a net profit of RM53.7 million for its first quarter ended March 31 of financial year 2014 (1QFY14) on improved performance in its drilling services, the group’s main business.

There is no figure in the previous corresponding period as the group was only listed late last year. However, based on the group’s audited annual accounts, 1QFY14’s net profit is 13.5% higher than last year’s quarterly average of RM47.3 million.

Revenue in 1QFY14 was RM195.6 million, 6.1% higher than the quarterly average of RM184.4 million last year. This was boosted by stronger contributions from the group’s offshore drilling rigs.

Group pre-tax profit rose 12.8% in 1QFY14 to RM58.3 million from the 2013 quarterly average of RM51.7 million. No dividend was declared for the quarter.

The drilling services segment contributed RM185.1 million in revenue or 94.6% of group revenue in 1QFY14. This was 6.7% higher than its quarterly average last year, thanks to full-quarter revenue contributions by all four offshore drilling rigs at higher utilization and efficiency rates.

However, lower utilization of hydraulic workover units UMW GAIT 1, UMW GAIT 2 and UMW GAIT 5 offset part of the revenue improvement.

The drilling services segment contributed RM56.4 million to pre-tax profit.

The oilfield services segment saw revenue of RM10.5 million or 3.7% lower than 2013’s quarterly average.

On its outlook, UMW-OG expects the drilling services segment to “deliver another year of satisfactory financial performance”.

“UMW NAGA 5, a premium jack-up rig, sailed to the Philippines and started generating income just three days after we took delivery of her from Keppel FELS on April 29,” the group said. “UMW NAGA 6 is expected to be delivered for deployment in September.”

It added that its hydraulic workover unit, UMW GAIT 3, had commenced a two-year firm contract with a one-year option with Petronas Carigali in March. UMW GAIT 2, UMW GAIT 5, and UMW GAIT 6 are also expected to be income generating during most part of the remaining period of 2014.

This article first appeared in The Edge Financial Daily, on May 20, 2014.