On the back of an 8.3% revenue hike
KUALA LUMPUR – 27 March 2019 YINSON HOLDINGS BERHAD (“Yinson” or the “Group”), Malaysia’s premier integrated offshore production and offshore support services provider, today announced its fourth quarter results for the financial year ended 31 January 2019 (“Q4’FYE2019”).
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 rose by 8.3% to RM287.6 million as compared to the immediate preceding quarter (Q3’FYE2019), mainly due to favourable reporting translation under an appreciated US dollar and recognition of early termination fee for FPSO Knock Allan. PAT improved 38.3% to RM71.6 million as compared to the preceding quarter.
The improvement was mainly due to: –
- Net reversal effect on impairment loss on property, plant & equipment – RM104.6m; and
- Absence of fair value loss on investment properties – RM3.5m
The increase was offset by:
- Unfavorable net foreign exchange movement of RM48.5m;
- Impairment loss on investment in a joint venture amounting to RM12.9m;
- Lower share of joint ventures and associates’ earnings of RM5.0m; and
- Higher finance costs of RM5.1m
QTD CORE & REPORTED PAT (RM'000)
FYE2019 vs FYE2018:
* Earnings associated with business operations, excluding earnings from non-operation items and gains or losses from nonrecurring items.
For FYE2019, the Group reported a revenue and profit after tax of RM1,034.9 million and RM264.4 million which translate to 13.7% increase and 9.5% decrease, year on year, respectively. Revenue growth was mainly due to the full year revenue contribution from FPSO JAK as opposed to roughly only 8 months’ contribution in the previous year. The chartering commencement of FPSO JAK began in June 2017. PAT, meanwhile, dropped by 9.5% to RM264.4 million year on year, a result of higher finance cost of RM78.0 million and lower share of joint ventures and associates’ earnings of RM31.0 million. These were however off-set by higher net favourable foreign exchange gains of RM42.0 million, lower administration overheads of RM24.5 million and higher interest income of RM12.9 million.
YTD CORE & REPORTED PAT (RM'000)
DIVIDEND
During this financial year, the Group has paid single-tier dividend twice and special-tier dividend amounting to 6.0 sen and 4.0 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 2019, to be tabled in the Group’s forthcoming Annual General Meeting for approval.
CHAIRMAN COMMENTARY – MR. LIM HAN WENG, GROUP EXECUTIVE CHAIRMAN OF YINSON
We are once again very proud to announce that our FYE2019 ended with our final quarter having recorded revenue and profit after tax of RM287.6 million and RM71.6 million respectively. That tantamounts to an increase of 8.3% and 38.3% correspondingly compared to Q3’FYE2019.
For full year FYE2019, the Group’s revenue amounted to RM1,034.9 million, an impressive 13.7% year on year growth, despite the volatile global oil price during the year concerned. FYE2019 has been a remarkable year for Yinson, with two projects secured and on schedule for delivery by Q4’FYE2020. The two are FPSO Helang and FPSO Abigail-Joseph.
Our entry into the Malaysian market through FPSO Helang was concluded through a novation arrangement with JX Nippon Oil & Gas Exploration (Malaysia) Limited (“JX Nippon”) in June 2018. This was followed by an agreement for Yinson, formalised on 20 March 2019, to undertake the provision of Operations & Maintenance (“O&M”) services for the said vessel.
The charter and O&M contracts have an estimated combined aggregate value of US$1,438 million, assuming the extension options are fully exercised. We are also pleased to report that Yinson’s newest office in Marina Parkcity, Miri, was set up on 28 December 2018 and is already operational. We are currently actively recruiting to ensure that the office is fully staffed by the time the vessel reaches the waters of the Block SK10 field in a few months’ time. Construction on FPSO Helang continues to progress well, and we are optimistic of achieving our delivery dates.
February 2019 also saw Yinson landing the much anticipated contract for the charter, operations and maintenance of the FPSO Abigail-Joseph with First Exploration & Petroleum Development Company Ltd (“FIRST E&P”) for use at the Anyala and Madu fields, Nigeria. The timing of this contract was perfect as the Group can redeploy FPSO Allan. This is the vessel that ceased operations on 29 January 2019 after nearly 10 years tenure at the Olowi oil field in Gabon. The redeployment not only minimises the vessel’s idling time but also enabled us to bring forward the project schedule while delivering a more cost effective solution for our client. The aggregate value of the contract, assuming the extension options are fully exercised, is US$902 million.
We foresee the months ahead to be exciting for Yinson as we await the outcomes of bids in which we have participated in and as we continue to explore potential plans for expansion in accordance with our growth strategy. At the end of FYE2019 we sit on a cash balance of MYR 1.2 billion, we are ready both in the form of financial and human resources. We look forward to continuing our delivery of positive financial results to our shareholders in the new financial year FYE2020.
