Singapore-listed offshore services provider, Viking Offshore posted profits of SGD173 million (USD125.8 million), up 94% year-on-year for the second quarter this year as a result of higher revenue.
Revenue surged 32% to SGD21.6 million in 2Q15 compared to SGD16.3 million in 2Q14, due to order book backlog carried forward from last year in the heating ventilation, air-conditioning, and refrigeration systems segment.
The company also saw a decline in business costs as its marketing and distribution expenses dropped 29% y/y to SGD182 million in 2Q15 from SGD255 million in the same period last year.
Other operating expenses decreased largely due to the reduction in amortisation of intangible assets as one of the intangible assets of a subsidiary was fully amortised at the end of the last financial year.
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The company expects a challenging year ahead due to the unfavourable market conditions with subdued activity level and spending in the upstream oil and gas business sector. Thus, Viking Offshore stated in its filing to the Singapore Exchange that the company remains wary of potential delays to existing projects and slowdown to potential projects.
“The group continues to exercise prudence when evaluating potential project contracts and have placed emphasis on internal improvement by carrying out proper execution of projects to avoid budget overrun” the company said.
In the meantime, Viking will seek for business opportunities in generating revenue stream from oil and gas related assets as part of its corporate strategy to enhance its asset portfolio and diversify revenue mix in weathering the market cyclical downturn.