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Bumi Armada posts RM223m net loss in Q1 on non-cash impairments

29 May 2020 / 14:21 H.

PETALING JAYA: Bumi Armada Bhd posted a net loss of RM223.97 million for its first quarter ended March 31, 2020 against a net profit of RM62.21 million reported in the same quarter of the previous year mainly due to impairment losses on vessels recognised in 2020.

Its revenue for the period rose by 12.4% to RM552.62 million compared to RM491.61 million reported previously.

Its floating production and operations (FPO) segment results increased to RM354.4 million for the quarter as compared to RM253.7 million reported previously, mainly due to higher revenue, lower operating costs from Armada Olombendo FPSO and Armada Perdana FPSO that was disposed of in September 2019.

Its offshore marine services (OMS) segment results decreased to RM6.9 million for the period compared to RM9.0 million registered previously mainly, due to higher operating costs and foreign exchange losses arising from translation of intercompany and bank balances denominated in foreign currencies, which was offset by improved offshore support vessel (OSV) utilisation in the quarter

Bumi Armada pointed out that Q1’20 saw a collapse in oil prices, which pushed the Brent benchmark to 30-year lows and subsequently have collapsed demand in the oil services sector. Hence, it has taken a non-cash impairments of RM314.4 million against the OMS business, which has led it to report a net loss of RM224 million for the quarter.

As at the end of the quarter, the group reported that its firm orderbook stood at RM18 billion with additional optional extensions of up to RM10.3 billion.

“The group focused on measures to protect staff and assets from the impact of the Covid-19 pandemic,” said its CEO Gary Christenson in a statement.

He pointed out that Bumi Armada’s operating profits before impairment stood at RM241.9 million for the quarter.

The group stated that its FPO fleet continued to deliver stable operations in the quarter and its revenue share continues to increase and is relatively immune to low oil prices.

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