Malaysia-listed oil trading and bunkering firm Straits Inter Logistics Berhad (SIL) on Thursday (27 February) posted a 75% jump in net profit for its financial year (FY) of 2019, propelled by strong demand for bunker fuel in the fourth quarter (Q4) of 2019.
SIL recorded net profit of RM 7.10 million (USD 1.68 million) in FY 2019, compared to RM 4.05 million in FY 2018, the company stated in its latest filing.
Revenue for FY 2019 totalled RM 663.23 million, a 159% jump from revenue of RM 225.79 million in the financial year before.
During Q4 2019, SIL posted net profit of RM 2.06 million, a 20% increase from net profit of 1.72 million for the similar period in the previous year.
The company recorded RM 203.56 million in Q4 2019, a 92% rise from revenue of RM 1.72 million in Q4 2018.
“The substantial increase in revenue [during Q4 2019] is attributable to the increase in demand for high sulphur fuel oil (HSFO) and the commencement of bunkering into Very Low Sulphur Fuel Oil (VLSFO) in conjunction with the implementation by International Maritime Organisation (IMO) on consumption of VLSFO by all vessels,” it explained.
“Diversification into inland transportation & logistics services in February 2019 through Straits Alliance Transport Sdn Bhd had further contributed to the increase of the revenue of the Group.”
The Group in Q4 2019 registered a profit before tax of RM3.31 million, a 100% growth compared to RM1.65 million in the corresponding quarter of 2018.
“The 100.0% jump in profit before tax in the fourth quarter of 2019 as compared to the fourth quarter of 2018 was due to a 91.4% increase in oil bunkering revenue arising from the Group’s expansion of its product line to include the bunkering of Marine Fuel Oil (MFO) and share of profits from its associate, Banle Energy International Limited,” it said.
“The Group strategy to expand its product line beyond its bunkering of Marine Gas Oil (MGO) into MFO has opened up tremendous business opportunity and widening of the market base.
“The Group will continue to expand its oil trading and bunkering business by increasing its deliverable tonnage capacities through increasing its vessels base by way of acquisitions of new vessels or chartering third parties’ vessels as well as broadening its geographical coverage.”
SIL, meanwhile, said it acquired the M.T. Ixora in Q4 2019; the bunker tanker is now the largest vessel in Group’s fleet and had commenced its bunkering services in Q1 2020 after obtaining its operation license from the Labuan Financial Services Authority on 29 January 2020.
The Group is also seeking to diversify its business into port management services; it has earlier received a letter of award from the Labuan Port Authority for the operation and facility management of Labuan Liberty Terminal in the Federal Territory of Labuan for a period of six years.
“With the commencement of M.T. Ixora’s operation and new business activities, the Group’s outlook for 2020 continue to look positive,” it concludes.
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Photo credit: Straits Inter Logistics
Published: 28 February, 2020
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