Yinson posts 24% earnings growth for third quarter

18 Dec 2019 / 22:12 H.

PETALING JAYA: Yinson Holdings Bhd’s net profit rose by 24.4% to RM53.97 million for its third quarter ended Oct 31, 2019, from RM43.4 million reported in the same quarter of the previous year attributed to favourable foreign exchange, net reversal in impairment loss on trade and other receivables and lower impairment loss on property, plant and equipment.

Revenue for the period stood at RM240.97 million, a 9.3% decline from RM265.58 million reported previously.

For the cumulative nine month period, the group posted a net profit of RM144.96 million, an 18.3% decline from RM177.5 million recorded in the corresponding period of the previous year due to lower revenue upon FPSO Allan’s charter cessation, net unfavourable forex movement and impairment losses.

Meanwhile, its revenue fell by 11.2% to RM663.4 million from RM747.3 million reported previously.

According to its Bursa filing, the group stated that the long-term outlook in the oil and gas industry remains challenging with the emergence of new alternative energy resources and financial institutions risk appetite towards the sector.

It highlighted that the overall current global economic is exposed to the risk of increasing trade protectionism, geopolitical conditions uncertainty, with higher downside risks.

Nevertheless, Yinson said that it remains optimistic about the industry’s overall outlook, reflected in part by its recent successful bid in Brazil for the FPSO Marlim 2 project and other potential upcoming projects in the pipeline.

The group’s executive chairman Lim Han Weng commented that it continues to receive strong support from financial institutions, with Yinson most recently securing a US$800 million (RM3.3 billion) refinancing deal with a total of 13 local and foreign banks for FPSO John Agyekum Kufuor.

“This deal will see us capitalising on the lower interest rates whilst allowing us to redirect our capital for future investments purposes,” he said in a press release.

Looking ahead, Lim stated that the group is actively assessing opportunities for diversification into other forms of energy, in line with its long-term goals that he believes will contribute to scaling up Yinson’s revenue base.

He also added that it was awarded two letters of intent from Petróleo Brasileiro S.A. for the charter, operations and maintenance of FPSO Marlim 2, a contract with an estimated aggregate value of US$5.4 billion and charter period of 25 years.

FPSO Marlim 2 is Yinson’s largest project to date, and will be our first vessel to operate in Brazilian waters,” he added.

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