Bumi Armada’s Q1 net profit down on impairment charge

PETALING JAYA: Bumi Armada Bhd saw its net profit for the first quarter ended March 31, 2016 (Q1FY16) fall 67.5% to RM23.43 million, from RM72.05 million in the previous corresponding quarter, mainly due to a non-cash impairment charge.
Revenue declined 24.7% to RM430.77 million, compared with RM572.15 million a year ago, mainly attributed to lower contribution from Armada Claire, lower utilisation of Armada Condor and Armada Hawk, and the decrease in overall utilisation of offshore support vessels (OSV).
Earnings per share fell to 0.4 sen for the quarter, compared with 1.23 sen for the same quarter a year ago.
In a statement yesterday, the group said it has made a non-cash impairment charge of RM17.9 million for a multipurpose construction vessel for the Armada Condor, in the offshore marine services (OMS) business during the quarter.
Commenting on the financial results, its CEO and executive director Leon Harland said the group’s underlying earnings remain strong, with net cash flow generation from operations of RM544.4 million and earnings before interest, taxes, depreciation, and amortization (ebitda) margin improving to 58.4% in Q1FY16, from 50.2% previously.
Harland said the group’s FPSO and FGS businesses would continue to focus on the delivery of the three FPSOs (Armada Kraken, Armada Olombendo and Karapan Armada Sterling III) and the FSU (Armada LNG Mediteranna), which all leave the shipyard in the second half of 2016.
He said the projects’ delivery would trigger a significant improvement in the group’s earnings and cash flow generation over full year 2017.