KUALA LUMPUR – 25 March 2021 YINSON HOLDINGS BERHAD (“Yinson” or the “Group”), one of the world’s leading energy solution providers, today announced its fourth quarter (“Q4 FYE2021”) and full year results for the financial year ended 31 January 2021.
FINANCIAL RESULTS
Current Quarter vs Preceding Quarter:
* Earnings associated with business operations, excluding earnings from non-operation items and gains or losses from nonrecurring items.
For the quarter under review, the Group’s revenue decreased by 45% to RM1,247 million as compared to Q3 FYE2021’s revenue of RM2,262 million. The decrease was mainly attributed to a one-off outright sales recognition in the preceding quarter in conjunction with FPSO Abigail-Joseph's lease commencement on 28 October 2020.
The Group’s profit after tax (“PAT”) decreased by 26%, or RM35 million, to RM102 million compared to the RM137 million recorded in the preceding quarter. The lower PAT was mainly attributed to the absence of one-off outright sales recognition contribution associated with FPSO Abigail-Joseph, presence of impairment loss on property, plant and equipment of RM11 million, increase in share of loss in joint ventures of RM23 million and increase in income tax expense of RM10 million. The decreases were mainly offset by the increase in EPCIC business activities contribution and absence of a RM84 million deal deposit written off in the preceding quarter.
QTD CORE & REPORTED PAT (RM'mil)
Current year vs preceding year:
* Earnings associated with business operations, excluding earnings from non-operation items and gains or losses from nonrecurring items.
Year on year, FYE2021 revenue and PAT increased by 92% and 58% respectively.
The increase in revenue was mainly attributed to the contribution from EPCIC business activities related to FPSO Anna Nery and FPSO Abigail-Joseph.
The Group’s PAT increased by RM151 million or 58% to RM412 million as compared to the RM261 million for the financial year ended 31 January 2020, attributed to the aforementioned contribution from EPCIC business activities, full year operations’ contribution from FPSO Helang, fresh contribution from FPSO Abigail-Joseph’s lease commencement in the fourth quarter and higher ‘other income’ of RM26 million. The positive contributions were offset mainly by the increase in depreciation and amortization charges of RM55 million, increase in impairment loss on property, plant and equipment of RM28 million, increase in loss on foreign exchange of RM13 million, presence of impairment loss on tax recoverable of RM10 million, presence of contract acquisition cost written off of RM104 million, a one-off RM84 million deal deposit written off, increase in finance cost of RM121 million mainly from a one-off charge out of remaining deferred financing cost associated to the repaid loan related to FPSO JAK's refinancing exercise concluded in April 2020 and financing of EPCIC business activities, decrease in share of results of joint ventures of RM39 million and increase in income tax expenses of RM98 million.
YTD CORE & REPORTED PAT (RM'mil)
DIVIDEND
During the financial year under review, the Group paid two interim single-tier dividends which amounted to 4.0 sen and 2.0 sen per ordinary share respectively.
The Board of Directors has further proposed a final single-tier dividend of 2.0 sen per ordinary share for the financial year ended 31 January 2021, to be tabled in the forthcoming Annual General Meeting for approval.
CHAIRMAN COMMENTARY – MR. LIM HAN WENG, GROUP EXECUTIVE CHAIRMAN OF YINSON
It has been a full year since Covid-19 was first declared as a pandemic by the World Health Organisation, during which we saw severe disruptions to the global economy. We are thankful to see the global economy recovering, with the International Monetary Fund revising global GDP growth forecast to 5.5% for 2021, up by 0.3 percentage point. Additionally, the economy’s recovery, vaccine roll out and increase in transportation and industrial activities are signs that demand for oil is set to increase. While fossil fuel is still a dominant source of energy, the renewable energy market is expected to grow at a compound annual growth rate of 8.3% from 2019 to 2026, to meet the world’s expected demand for energy.
Amidst all the challenges, I am delighted that Yinson was able to maintain its financial robustness in FYE2021 through the growth of its EPCIC and non-EPCIC business activities, where we achieved a 92% revenue growth and 151% increase in core profit.
On 2 March 2020, Yinson, through its subsidiary Rising Sun Energy (K) Pvt Ltd, won a contract to develop and operate a 190MW solar project in the Nokh Solar Park, Rajasthan. This secures the second major asset in our renewables portfolio and further consolidates our position in India. Yinson will sign a 25-year power purchase agreement with NTPC Limited for the Nokh project, and initial activities are already underway as per schedule, for the plant to be operational by 2022. We are pleased that this project award followed on so seamlessly after our 95% acquisition of Rising Sun Energy Pvt Limited (“RSE”) just three months ago. RSE owns and operates the Rising Bhadla 1&2 Solar Plants, situated 30km west of Nokh Solar Park. This milestone is an exciting indicator that the synergies between Yinson and RSE have positioned the Group for steady growth in India’s renewables segment.
The conversion of FPSO Anna Nery remains on track with a successful accumulation of more than 4.6 million manhours without any Lost Time Injuries (LTIs) thus far. With hull integrity structural works completed, we will be commencing our last drydocking campaign shortly. Module fabrications at our four sites are progressing well, with the first module on track for delivery in Q3 this year. Despite the Covid19 pandemic, delivery of critical long lead equipment to our topside subcontractors and shipyard in China is taking place smoothly as planned.
On the operations front, we are pleased to report commercial and technical uptimes of 100% and 99.3% respectively for our fleet in FYE2021. Additionally, Yinson did not experience any LTIs on any of our FPSOs during the year. Our newest asset to go on charter, FPSO Abigail-Joseph, has been producing steadily without any major challenges, achieving a technical uptime of over 99% in its very first full quarter of operations. These are truly commendable performances, especially given the various challenges arising from the Covid-19 pandemic. My heartfelt thanks go out to our operations team and crew for their tireless efforts.
In line with our aim of accelerating the global transition towards a sustainable energy system, Yinson has invested in Norwegian tech company, Lift Ocean AS, on the development and commercialisation of hydrofoil technology for marine harbour crafts. This is one of several projects that Yinson’s Green Technologies Division, which was established in September 2020, has embarked on. We plan to showcase this hydrofoil technology, alongside some of our other green technology initiatives, during Singapore Maritime Week taking place next month from 19 to 23 April.
Sustainability is taking centre stage at Yinson now more than ever before. We have increased our commitments to align with a further three UN Sustainable Development Goals (SDG) – Gender Equality (SDG5); Industry, Innovation and Infrastructure (SDG 9); and Climate Action (SDG 13) – adding these to our existing commitments to four SDGs for quality education; affordable and clean energy, decent work and economic growth and life below water. We are also committed to improve on our ESG disclosures significantly moving forward, and will be working to update our website and other online platforms with our progress on operationalising sustainability across the Yinson Group.
Although the external environment continues to present many challenges, Yinson will continue to adapt and innovate in order to continue delivering value for all our stakeholders. We thank you for all the support you have given us throughout FYE 2021, and we look forward to our continued journey with you.
