Malaysian offshore service provider Coastal Contracts posted a record-breaking profit of MYR65.9 million (USD18.3 million) for the first quarter of 2015, up 34% year-on-year (y/y).
Revenue was up 56% to an all-time high of MYR351 million in the first quarter 2015 from MYR224.7 million in the same quarter 2014. Similarly, gross profit surged 24.9% to MYR65.6 million in the first quarter this year compared to MYR52.5 million y/y.
The increase was due to the more revenue from its shipbuilding and ship repair division, which jumped almost two-fold from MYR176.4 million in the first quarter 2014 to MYR349.5 million in 2015, the company said. The better performance of the division was attributed to higher number of delivered offshore support vessels (OSV) – five units, compared with two units in in the last quarter 2014 and three units a year ago.
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As well, the company’s vessel chartering division also generated marginally higher revenue of MYR1.4 million in the first quarter 2015, compared with MYR1.3 million last quarter 2014 and MYR1.2 million y/y. Coastal attributed the increase mainly to income earned from a short-term trip charter contract.
Meanwhile, the company also reduced some of its costs, with lower finance costs in the first quarter 2015 at MYR28,000, down 9% y/y, while its income tax bill was MYR0.3 million less in 2015, compared with MYR0.58 million y/y.
Coastal Contracts remained upbeat on the future of the oil and gas industry. “In tandem with the rising population growth, motorisation, emerging economies notably in China, India, and Middle East as well as the development of rural areas in most countries, the demand for oil and gas would certainly move in an upward trend in the medium- to long-term,” it said in its filing to the Malaysia stock exchange (Bursa Malaysia).
The company also predicts a sound market outlook for the jack-up rig market in the medium- to long-term. “Coastal Group is committed to further defend its competitive position in the offshore oil and gas market seeing that successful offshore exploration activities in [South America] may necessitate upgrades of the jack-up drilling rigs to accommodate specific regional requirements.”