The article below was edited on 31 May, 2018 to correctly reflect the net profit of Straits Inter Logistics:
Malaysia-listed bunkering firm Straits Inter Logistics (Straits) posted a 68% 18.5% decrease in net profit for the quarter ended 31 March 2018 (Q1 2018) partly due to a stronger Malaysian Ringgit currency.
It recorded net profit of RM 208,000 ($52,000) RM 536,000 ($134,000) in Q1 2018, lower than net profit of RM 658,000 in the similar quarter last year, showed financial data.
Revenue in Q1 2018 was RM 36.4 million, a 57% increase over revenue of RM 23.1 million during Q1 2017. The increase “was partially contributed by the bunkering's Contract for Services which came into effect in the fourth quarter of 2017.”
“Over the same quarter, the Group, however, achieved a lower profit before tax of RM0.58 million, as compared to RM0.72 million in 2017 due to the strengthening of the Malaysian Ringgit against major foreign currency. This has eroded RM0.42 million from the profit before tax,” it explains.
Moving forward, Straits says it is planning to expand its oil trading and bunkering business by increasing its deliverable tonnage capacities in the current year.
The company will be either increasing its vessels base by acquiring new vessels or chartering third parties' vessels; it also plans to with strengthen its operational capabilities and broaden its geographical coverage to capture the growth opportunities in the oil bunkering industry in Malaysia and Asian region.
“The Group will continue to assess the demand from its existing and potential customers through continuous marketing activities in increasing its oil bunkering activities in the coming year,” it says.
“Nevertheless, the Group’s operations are dependent on the level of activity in the exploration, development and production of oil and natural gas, including the level of capital spending in the offshore oil and gas industry.
“Despite the relatively positive outlook for the offshore oil and gas industry, the industry competition is expected to intensify further in view of the rising operating costs and fluctuations in foreign exchange rates.
“The Group will continue to take all reasonable steps and precautions to mitigate the impact of rising costs and intensifying market competition.”
Straits on 18 January 2018 entered into a nonbinding Heads of Agreement with Hong Kong-based bunker trading firm Banle Energy International Limited to explore potential business cooperation and/or collaboration opportunities.
Related: Malaysia: Bunkering firms extend HOA arrangement
Related: Straits Inter Logistics: Positive outlook for Malaysia bunkering sector
Related: Malaysia-listed bunkering firm Straits Inter Logistics net profit up 27 times
Related: Straits Inter Logistics and Banle Energy explore bunker business opportunities
Photo credit: Straits Inter Logistics
Published: 30 May, 2018
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