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Alam Maritim posts first profitable quarter after two years

The Edge logo The Edge 19/11/2019 Wong Ee Lin
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KUALA LUMPUR (Nov 19): Alam Maritim Resources Bhd returned to black with a net profit of RM535,000 or 0.1 sen per share in its third quarter ended Sept 30, 2019 (3QFY19), as revenue jumped more than five times year-on-year to RM114.6 million.

The group recorded a net loss of RM21.39 million or 2.3 sen per share in the same period last year, when revenue came in at RM21.41 million, its stock exchange filing today showed.

This is its first profitable quarter for Alam Maritim after eight consecutive loss making quarters. The offshore services player has been in the red since its financial year ended Dec 31, 2016 (FY16).

Following the improved quarter, the group's cumulative nine-month net loss narrowed to RM8.16 million from RM42.23 million last year, thanks mainly to higher contribution from its offshore installation and construction (OIC) projects. Revenue surged to RM208.61 million, which is three times more than the previously-recorded RM61.75 million.

"Subsea services/OIC segment registered a profit before taxation of RM11.06 million, as compared to a loss before taxation of RM0.18 million in the same period last year, due to higher revenue and margin contribution registered by the OIC segment during the current financial period," it noted.

Its offshore support vessels and services segment also registered a lower loss before tax of RM18.1 million versus RM27.01 million previously, thanks to an increase in charter contracts.

On prospects, Alam Maritime said its business outlook is influenced by the level of capital expenditure spending by oil majors.

Citing the recently issued Petroliam Nasional Bhd (PETRONAS) Activity Outlook for 2019-2021, the Alam Maritim said Petronas has maintained its prudent view on the industry outlook and will respond with cautious optimism, particularly on new capital projects.

“However, growth is expected in brownfield activities, particularly in rigs and OSV (offshore support vessel) segment,” Alam Maritim added.

Nonetheless, Alam Maritim said its directors will continue to exercise due care in managing and implementing the group's business strategies to ensure that shareholders’ values are strategically enhanced from time to time.

Shares of Alam Maritim closed half a sen or 4.76% lower at 10 sen today, valuing the group at RM100.17 million.

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