Malaysia-listed offshore services provider SapuraKencana Petroleum’s first-quarter 2015 net profit almost halved to MYR261.2 million (USD69.6 million), compared with the net profit of MYR510 million in last year’s quarter.
The decrease was followed by the dip in its revenue for first-quarter 2015 at MYR2.25 billion, down 7.8% from MYR2.44 billion in first-quarter 2014. The company’s engineering and construction (E&C) segment registered marginally lower revenue by MYR48.9 million or 4.3%, mainly owing to lower scope of works for the existing contracts in line with clients’ planned activities, offset with higher contributions from newly executed international projects during the quarter. Thus, operating profit for the E&C segment was 17.6% lower at MYR187.4 million in first-quarter 2015 from MYR227.5 million in first-quarter 2014.
Similarly, SapuraKencana’s energy segment revenue for the current quarter decreased by MYR320.7 million or 43.6%, primarily due to a combination of lower barrels of oil lifted as a result of the natural decline of oil reserves in the Production Sharing Contract blocks and lower average price per barrels. Consequently, the operating profit of the energy segment was recorded at MYR138.6 million or 70% lower than MYR198 million in the first quarter of 2014, excluding the gain arising from the acquisition of subsidiaries.
However, SapuraKencana’s drilling segment revenue for the first quarter of 2015 was higher by MYR125.2 million or 19.4%, compared with the corresponding period last year, mainly because of commencement of contract for new deliveries. As a result, the operating profit for the drilling segment was 26.8% year-on-year higher in the current quarter.
Going forward, SapuraKencana anticipates a challenging market environment to persist over the medium term. However, the company has made in-roads in new markets such as Mexico. SapuraKencana has also managed to secure and replenish its orderbook with new contract wins in India, Indonesia, and Vietnam.