MISC Berhad grows through 2014 but profits slip in Q1 2015

MISC Berhad has reported its financial results for 2014. It reported revenue of RMB9.30bn, an increase of 3.6% against the preceding year. The company also reported operating profit of RMB1.84bn, a substantial rise of 18.6% year-on-year. Accordingly MISC Berhad’s margin stood at 19.78%.

The increase in revenue was driven primarily by improved freight rates and the commencement of operations of the Floating Production, Storage and Offloading Cendor. These positive developments, coupled with effective cost management from a smaller fleet of operating vessels led to the increase in operating profit.

Following the improvement in the operating profit, MISC Berhad’s profit before tax from continuing operations increased to RMB2.41bn. This represents an increase of 8.2% from RMB2.23bn recorded in the previous year, mainly powered by contributions from the LNG, Offshore and Petroleum tanker businesses.

In Q1 2015 the group attained RMB2.49bn in revenue which translated to an increase of 8.7% from the corresponding quarter of 2014. The increase was again fuelled by improved freight rates in the Petroleum business and commencement of finance lease income of Floating Production, Storage and Offloading Cendor. However, a smaller fleet of operating vessels in Chemical business and lower earning days in LNG business moderated the increase in group revenue.

Q1 operating profit of RM468.2m was 7.2% lower than Q1 2014, mainly due to lower revenue in LNG business and additional costs incurred on some heavy engineering projects. However, higher profit in Offshore business and lower losses in Chemical business helped to alleviate the decrease.

“We are pleased to start the year with a positive revenue growth although the year ahead is expected to be challenging, particularly due to the temperamental market conditions. Nevertheless, we remain cautiously optimistic on long-term prospects, and we are focused on our strategic plans towards sustainable growth,” said Yee Yang Chien, President and Chief Executive Officer nof MISC Berhad.