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Maybulk widens first half loss to $16m

Maybulk widens first half loss to $16m
Malaysian Bulk Carriers (Maybulk) widened first half losses to MYR64.9m ($16.2m) from MYR44.4m in the previous corresponding period, mainly due to negative contribution from its OSV unit PACC Offshore Services Holdings (POSH) and the persistent weak dry bulk market.

Revenue meanwhile also dipped slightly to MYR108.9m from MYR109.9m in the first half of 2015. On a quarterly basis losses nearly doubled to MYR40.1m in the second quarter from MYR21.3m previously while revenue dipped to MYR55.4m from MYR58.1m previously.

The dry bulk segment widened its loss by 9% to MYR61.4m compared to a MYR56.1m loss in the first half of 2015. This was due to a 29% drop in charter rates earned, Maybulk said in a stock market announcement.

Profit from the tanker segment however rose to MYR14.9m in the first half but this was partially due to the extraordinary gain from sale of vessels. Excluding this, tanker segment profit was MYR11.8m compared to MYR5.2m previously, mainly due to improved charter rates earned as average TCE rates rose to $14,961 per day from $13,519 per day previously.

Profit from the ship brokerage and management segment however rose by two thirds to MYR864,000 from MYR521,000 previously due to higher fees earned and lower expenditure.This however remained a small proportion of overall income.

Maybulk's offshore unit POSH reported a loss of $13.1m in the first half against a profit of $6.1m previously, mainly due to lower contributions from its OSV segment and higher provisions for doubtful debts as the offshore services market continues to struggle with weak oil prices.

Maybulk's share of POSH results amounted to a loss of MYR11.5m in the first half, against a profit of MYR4.7m in the same period last year.

Looking ahead, Maybulk said the dry bulk market continues to remain difficult, and although the spot rates for dry bulk have increased from the s average in the second quarter of 2016, there is continued nervousness in the global economy and the recovery of the dry bulk market remains uncertain.

Meanwhile in the oil and gas sector, with lower capex by oil majors and oilfield operators continuing to seek further reductions in their operating cost there has been downward pressure on vessel utilisation and charter rates which will continue to negatively impact the POSH Group’s financial performance, Maybulk said.

All considered Maybulk said, the board is of the view that the outlook for the remainder of the year remains difficult and the group is expected to report a loss forthe full year.