PETALING JAYA: Sapura Energy Bhd’s net loss widened to RM2.29 billion in the fourth quarter ended Jan 31 from a net loss of RM172.32 million a year ago, mainly due to a RM2.1 billion impairment registered in its drilling segment.
“The group assesses all aspects of its asset lifecycle periodically based on market changes and views impairment assessments as a healthy industry practice. The impairment recorded, which has no impact on cash, creates a lighter asset base for the group by reducing the total carrying value and depreciation charge of our drilling rigs going forward,” said its president and group CEO Tan Sri Shahril Shamsuddin.
“This enables us to operate at a lower cost base in the future while enhancing our competitiveness for growth and at the same time improve profitability,” he said in a statement.
Sapura Energy’s shares continued to be the most actively traded stock this week, closing 4.5 sen lower to 50 sen with some 214.14 million shares changing hands.
In a filing with Bursa Malaysia today, the group said the net loss was also due to a lower share of profit from associates and joint ventures of RM56.94 million, compared with RM147.48 million a year ago.
At the operating level the group registered a 27.84% lower profit of RM348.9 million, compared with RM483.5 million for the corresponding quarter in 2016 due to lower revenue from the engineering and construction and drilling business segments.
Revenue for the quarter fell 34.40% to RM1.19 billion from RM1.81 billion a year ago.
During the quarter, the engineering and construction segment recorded a wider pre-tax loss of RM84.2 million compared with RM37.7 million a year ago, while revenue fell 42% to RM670.3 million from RM1.16 billion a year ago.
The drilling segment also recorded a wider pre-tax loss of RM2.11 billion after impairments compared with a pre-tax profit of RM3.4 million a year ago, while revenue fell 42% to RM230.4 million from RM397.4 million a year ago.
For the financial year ended Jan 31 (FY18), the group suffered a net loss of RM2.5 billion compared with a net profit of RM208.32 million a year ago, in line with lower revenue, which fell 22.95% to RM5.89 billion from RM7.65 billion a year ago.
Moving forward, the group is optimistic that the gradual recovery in the industry will improve its medium-to-long term prospects and will remain focused on maintaining strong operational performance and replenishing its orderbook.
In line with the gradual recovery, its services segment has seen increased levels of bidding and contracting activities globally.
In the last two months, the group secured RM2.7 billion of new orders in the services segment, which would contribute to revenues for FY19.
Source: The Sun Daily