Singapore-listed offshore services provider Vallianz Holdings’ revenue increased by 119% to USD60.7 million for the first quarter of 2015 that ended on 31 March 2015.
Despite the huge gain in earnings, the company’s profit for the period only increased slightly by 1% to USD5.5 million, compared with USD5.4million in the first quarter of 2014. Vallianz cited in its filing to the Singapore Exchange that the higher earnings were driven by higher charter and brokerage revenue in the first quarter, as well as an increase in revenue derived from ship management services, shipyard services, and investments.
The growth in revenue from ship management and shipyard services was attributed to contributions from Jetlee Group, OER Group, and Newcruz Group, which Vallianz acquired in the last quarter of 2014. Therefore, the company’s charter and brokerage services segment accounted for 63% of the group’s revenue in the first quarter, compared with 89% in corresponding period last year. As of 31 March 2015, Vallianz’s vessel chartering business had a fleet of 39 offshore support vessels (OSV).
However, the company faced rising costs mainly from administrative expenses and finance costs. Its administrative expenses have hiked 111% to USD5.58 million in the first quarter, compared with USD2.64 million in the corresponding period last year. The increase was attributed largely to the consolidation of expenses of subsidiaries acquired in the last quarter of 2014, as well as staff and travel related expenses.
In the meantime, Vallianz’s finance costs rose by 197% to USD6.6 million in the first quarter, compared with USD2.23 million in the first quarter of 2014. It was due to the issuance of notes under the multicurrency debt issuance programme in second quarter of 2014.
The company expects its contracts secured in 2014 to start contributing to its revenue for 2015. Meanwhile, Vallianz will continue to increase its penetration in the Middle East, Latin America, Asia, and West Africa to become a major OSV player through actively bidding for charters, as well as optimising its operations by enhancing cost efficiencies and financial management.