KUCHING: Dayang Enterprise Holdings Bhd (DEHB) group’s net profit has soared to RM236.3 million in financial year ended December 31, 2019 (FY2019) — the best ever annual profits the company has achieved.
The historic profits was RM72 million or 44 percent higher than RM164.2 million recorded in FY2018.
The group’s gross profit has increased by 29 percent to RM499 million from RM385.4 million year-on-year mainly due to higher profit margin on work orders performed.
The group has accounted for a gain on bargain purchase of RM18.8 million arising from the acquisition of a new subsidiary and a net realised/unrealised foreign exchange of RM1.1 million in the current year as compared to similar gain of RM11.4 million in 2018.
Group’s revenue surged to about RM1.05 billion from RM937.6 million or up by 12 percent year-on-year.
Earnings per share rose to 24.4 sen from 17.02 sen year-on-year.
“This remarkable achievement comes on the back of the robust work orders for the Maintenance, Construction and Modifications contract (MCM) and topside maintenance services works under the Pan Hook-up and Commissioning Contract (Pan HUC).
“Consequently, vessel utilisation also came in stronger at 70% for 2019 as compared to 64% in 2018,” Dayang said in notes to its latest yearly financials.
The Miri-based company said in second half-2019, more work orders with higher values were issued by its clients and executed as job momentum continued to pick up strongly.”Therefore, not surprising, for the first time in our long history, Dayang group is able to achieve our annual revenue exceeding the RM1 billion mark.
“Presumably, the combined strength and the synergistic collaboration between Dayang and its subsidiary Perdana Petroleum is working well.” Perdana owns and operates a fleet of 16 offshore supply vessels, several of which are chartered to Dayang group.
In fourth quarter ended December 31, 2019 (Q42019), Dayang posted lower group’s net profit of RM78.2 million, down from RM97.7 million in Q42018 as group’s revenue remained flat at RM285 million. Earnings per share for the latest quarter declined to 7.99 sen from 10.13 sen.
As compared to Q32019,group’s revenue declined by 20 percent from RM357.6 million while net profit fell by 21 percent or RM37 million from RM107 million.
“The decrease in revenue in the current quarter as compared to the immediate preceding quarter is mainly due to lower vessel utilisation rate and lower work orders from the maintenance contracts.
“The lower vessel utilisation is a result of lower work orders/contracts awarded from the oil majors during the fourth quarter of 2019,” explained Dayang.
In December 2019, Dayang was awarded two I-HUC contracts by Petronas Carigali Sdn Bhd.
Early this month, Dayang added on another contract by Carigali — TTEPI Operating Company Sdn Bhd for the provision of modification works for Block B17 & C-19 and B-17-01 for three years with two years extension option.
“Both thse replenishments of new contracts has increased our order book to an estimated RM4.5 billion to last us unitil 2020.This will positively enhance our prospects and earnings visibility over the next three years.
“We remain upbeat on the company’s future prospects as Dayang will leverage on its strong execution track record to ride on the ramp-up in business activities,” said the company.
Dayang has recently completed its group-wide debt restructuring exercise, which raised gross proceeds of RM88.76 million from a rights issue.
From the proceeds,RM70 million is for partial repayment of bank borrowings,RM16.96 million for group’s working capital and RM1.8 million to pay for the expenses of the fund raising exercise.
Dayang has also proposed a private placement of up to about 96.48 million ordinary shares, representing about 10 percent of the company’s total number of issued shares.
The company has obtained Bursa Securities’ approval for an extension of time until August 26, 2020 to complete the implementation of the private placement.
Dayang has also established a Sukuk Murabahah Programme with the issuance of Sukuk Murabahah amounted to RM682.5 million on November 15, 2019.
Of the amount,RM365 million was advanced to Perdana to redeem the latter’s outstanding Sukuk Murabhah of a similar sum.
The balance was used to repay the several facilities obtained by Dayang and Perdana.
The group-wide restructuring exercise involved that of Perdana,with the help of the corporate debt restructuring committee (CDRC) of Bank Negara and has been completed recently.
“After the completion of the group-wide debt restructuring, Dayang is now ready to embark on long term growth plans to further maximise shareholder value given our more efficient capital structure.
“We are confident that our strong cash flow generation and heatlhier balance sheet will propel us to greater heights going forward,’ said Dayang.
