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Latest Quarterly Result

Quarterly Report For The Financial Period Ended 30 September 2018

Financials Archive

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Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the Second Quarter ended 30 September 2018 (Unaudited)

Income Statement

Condensed Consolidated Statement of Financial Position as at 30 September 2018 (Unaudited)

Balance Sheet

Review of Financial Performance

B1.1 The Group's performance for the current quarter under review versus the corresponding quarter of the previous financial year is tabled below:

Review of Performance

Comparatively, the Group's revenue for the current quarter ended 30 September 2018 increased by 32% while the group made a profit before tax of RM67.7 million for the current quarter as comparedto profit before tax of RM14.8 million in the corresponding quarter ended 30 September 2017.

The increase in revenue and profit before tax in the current quarter is mainly due to higher work orders received and performed under the topside maintenance contracts.

In addition, the profit before tax in the current quarter has also taken into account impairment loss on PPE of RM5.8 million and net realised/unrealised foreign exchange gain of RM14.2 million whereas impairment loss on PPE and net realised/unrealised foreign exchange losses of RM1.4 million and RM7.9 million respectively were accounted for in the corresponding quarter ended 30 September 2017 (see Note A4).

In the opinion of the Directors, the results for the current quarter have not been affected by any transactions or events of a material nature which have arisen between 30 September 2018 and the date of this report.

B1.1 The Group's performance for the current quarter under review versus the corresponding quarter of the previous financial year is tabled below:

Review of Performance

Revenue increased by 25% from RM521.7 million in the previous corresponding period-to-date to RM652.0million in the current period-to-date. The higher revenue in the current period as compared to the corresponding period is mainly due to higher value of work order received and performed in the current period.

Group registered a profit before tax for the current period of RM88.8 million as compared to a loss before tax of RM57.5 million in the corresponding period last year. The higher profit before tax in the current period is mainly due to higher volume of work orders performed under the topside maintenance contracts.

In addition, the profit before tax in the current period has also taken into account net realised/unrealised foreign exchange gainof RM11.4 millionand impairment loss on PPE of RM12.9 million whereas net realised/unrealised foreign exchange losses and impairment loss on PPE of RM32.5 million and RM50.4 million respectively were accounted for in the corresponding period preceding year (see Note A4).

Prospects

Business activities have picked up substantially in the third quarter as per our planning schedule given the ramp-up in work orders for the Maintenance, Construction and Modifications Contract (MCM) and Topside Maintenance Services works under the Pan Hook-up and Commissioning Contract (Pan HUC). Consequently, vessel utilisation also came in stronger at 84%, compared to 70% in the second quarter and 27% in the first quarter, giving an average utilisation rate of 61% for the 9 months period in 2018. We are particularly delighted that the synergistic collaboration between Dayang and its subsidiary, Perdana Petroleum has indeed worked out as what we have envisaged to be a leading integrated MCM player.

Barring any unforeseen circumstance, we are optimistic that the turnaround in our earnings will be sustainable, premised on our fairly sizeable order book of RM3 billion to last us until 2023. Notwithstanding the volatility in oil price, we remain upbeat on our company's future prospects as Dayang has emerged stronger after going through one of the most challenging period over the past few years. We are cautiously confident that our balance sheet will continue to improve significantly as the impressive financial performance in the third quarter has indirectly demonstrated the financial discipline undertaken to turn around the company.

After securing a larger portion of the Pan MCM contracts estimated at RM1.5-2.0 billion (the contracts are all based on unit rates and call-out contracts) from multiple production sharing contractors in Malaysia this year, Dayang has also started to look at international expansion to further grow the company. We are hopeful that our streamlined operation and strong execution track record will help us to win some of the overseas tenders.

As for our subsidiary Perdana Petroleum Berhad (PPB), the proposed debt restructuring scheme with the financial institutions under the Corporate Debt Restructuring Committee (CDRC) of Bank Negara Malaysia is still under discussion and once the financing obligations is finalised, PPB and Dayang Group should emerge stronger than before.

We firmly believe that 2018 will be a real turnaround for the group after experiencing poor results over the past two financial years. Nevertheless, the Board will remain vigilant and continue to exercise due care and prudence in the running and administration of the company's business.


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