KUCHING: Ocean Vantage Holdings Bhd (OVH) has met the Bumiputera equity requirement following the completion of the issuance of special issue shares to Bumiputera investors.
The company has said earlier that up to 61.65 special issue shares would be issued to Bumiputera investors to be identified and approved by the Ministry of International Trade and Industry.
The allocation to the Bumiputera investors shall be allocated at least 12.5 per cent of the company’s enlarged share capital.
The issue price of the special issue shares was RM0.235 per share.
OVH said the Securities Commission (SC) had in its letter date Sept 7, 2022, deemed the company to have complied with the Bumiputera equity requirements.
Meanwhile, OVH has reported lower earnings in second quarter ended June 30, 2022 (2Q2022) as group net profit was nearly halved to RM1.43 million from RM2.79 million in 2Q2021 as revenue fell to RM31.7 million from RM35.1 million.
The company’s earnings per share declined to 0.34sen from 0.68sen.
In the latest quarter, the group revenue was mainly contributed by the supply of manpower segment which amounted to RM21.2 million or 66.8 per cent of group turnover.
The remaining revenue was derived from the engineering, procurement and construction (EPC) and project management segment ,and supply of material, tools and equipment segment which amounted to RM9.4 million and RM1.13 million respectively.
As compared to the immediate preceding quarter (1Q2022), OVH has improved its financial performance as both revenue of RM31.7 million and pre-tax profit of RM3 million were higher than RM26.8 million and RM1.9 million respectively recorded in 1Q2022.
The increase in revenue was mainly contributed from EPC and project management segment by RM3.92 million and supply of manpower segment by RM1.78 million arising from the commencement of Bintulu Additional Gas Sales Facilities 2 (BAGSF 2) project.
“The higher demand by the rig operators on the other hand contributes to the rise in revenue from supply of manpower segment,” the company said in explanatory notes to its financials.
However, the revenue from the supply of material, tools and equipment segment fell by RM0.78 million in 2Q2022 due to the stoppage of business dealings with certain customers.
Over a six-month 2022 period (6m2022),OVH posted lower group net profit of RM2.81 million (6m2021:RM5.27 million) on lower revenue of RM58.5 million (RM63.3 million).
“The decrease in revenue was mainly due to the lesser revenue contribution from EPC and project management segment by RM13.03 million as the large-scale solar farm (EPCC project) was completed in financial quarter Q2/21.
“The revenue from the supply of manpower segment increased by approximately RM9.29 million in the current financial quarter as compared to the financial quarter Q2/21 whereby the group continued to benefit from higher demand from customers due to favourable oil price.
“The supply of material, tools and equipment segment experience a decrease in revenue by RM1.07 million or approximately 25.94 per cent due to business decision to temporary half business dealings with certain customers,” it added.
Commenting on prospects, OVH said: “The continued tension between Russia and Ukraine, reopening of more international borders and on going global recovery are seen to be pushing crude oil prices to favourable levels for oil companies to increase their capital expenditures (Capex) and activities in Malaysia and globally.
“The increase in Capex will be favourable to the group as the group expects the possibility of more work to be tendered out by both the national and international oil companies. Aside to the potential of new projects coming online, there will be a number of current offshore maintenance contracts that will be ending soon and will be re-tendered out in Q4/22 and Q1/23.”
According to OVH, the group’s transformation efforts are starting to have its effect as efficiencies within the company has improved and the group is seeing more work being entrusted to it by its clients.
OVH said the increase in the number of purchase orders which are equivalent to work orders will have a significant impact to the group revenue.
“The group’s wholly-owned subsidiary Ocean Vantage Engineering Sdn Bhd (OVESB) has commenced work on the RM71.32 million BAGSF 2 project in Bintulu with estimated completion in 2Q/23. OVESB also expects additional variation orders to be added to this contract value as the project progresses.”
Another subsidiary Ocean Vantage Electrical and Instrumentation Sdn Bhd (OVEI) has also commenced work on its recently secured RM4.8 million project with Bakat Industri Sdn Bhd.
Additionally, Ocean Vantage Integrated Solutions Sdn Bhd and Ocean Vantage Inspection Testing Sdn Bhd continue to attract smaller value projects.
“The group’s renewable energy division is currently aggressively promoting root top solar as well as intensifying the ground work to roll out the group’s first pilot electric vehicle (EV) charging station. The group remains committed to expand the renewable energy solutions portfolio and be actively involved in the development of electric vehicle infrastructure related works and help built the country’s EV ecosystem,” said OVH.
The company said currently the group is tendering for various projects with gross value of close to RM300 million.
Its various subsidiaries are actively participating in tenders with the support of technological business partners that adds value to their proposals.
OVH said the group is also seeking non-organic growth opportunities through merger and acquisitions and strategic partnerships with both local and international players to strengthen its presence in the industry.
An example is OVH’s recent announcement on the acquisition of Esprat Sdn Bhd is a strategic acquisition to strengthen its capabilities in becoming an integrated solutions provider to the oil & gas industry in Malaysia.
The company added: “The board (of directors) is of the opinion that the group’s company structure and transformation efforts will benefit the group with the continued recovery strength of the O&G sector.
While all the jobs that have been captured by the group are more towards sub-contracting work, these work are seen by the group as progressively strengthening its core capabilities to become a major player in the EPCC segment as the group moves up the supply chain.