Profit in the first half ended 30 June 2015 rose by 3.5% to MYR100.74m ($23.73m) from MYR97.39m recorded in the previous corresponding period. The growth was attributed to increased delivery of OSVs during the first quarter as well as enhanced product mix comprising of higher-value OSVs.
First half revenue also jumped by 10.3% year-on-year to MYR514.97m, Kuala Lumpur-listed Coastal Contracts announced.
The group’s second quarter profit, however, dropped by 27.8% year-on-year to MYR34.83m due to fewer deliveries on the back of a slowdown in capital expenditure by various oil and gas players.
“While the group is witnessing slower OSV orders due to weak sector sentiment, we would strive to continue converting existing enquiries into sales orders,” said Ng Chin Heng, executive chairman of Coastal Contracts.
Ng added that the company looks forward to the timely delivery of its oil and gas assets in the third quarter, namely its first jack-up gas compression service unit (JUGCSU) and a jack-up drilling rig named Coastal Driller 1.
While drilling subsides due to the recent low oil price, Coastal Contracts said it remains committed to further defend its position in the offshore oil and gas market particularly in the Gul of Mexico and Southeast Asia, which may necessitate upgrades of jack-up drilling rigs to accommodate specific regional requirements.
As such, the group foresees a sound market outlook for the jack-up rig market in the medium to long term.
It also noted that the gradual depletion of shallow water fields would also subsequently trigger a demand surge for deepwater capable OSVs in the medium to long run and push the OSV market into the firm territorial.
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