Oil and gas seen driving SILK's future profits

There are substantial business opportunities in the sector and the group was set to strengthen its position as a leading services provider in the industry, especially upon completion of the proposed acquisition by its unit of the remaining stake it did not already own in four ship-operating companies (SOCs) currently held by a joint-venture partner, Mohd Azlan added.

“At present, we have a very decent utilisation rate at more than 70%. I can say all our vessels are chartered out,” he said.

SILK's main O&G unit, Jasa Merin will acquire  of the remaining 49% stake in four SOCs,  JM Global 1 (Labuan), JM Global 2 (Labuan), JM Global 3 (Labuan) and JM Global 4 (Labuan), held by its joint-venture partner GMV-Jasa for a purchase consideration to be determined later and to be satisfied entirely in cash. The deal is expected to be completed by the end of the month. Jasa Merin is a 70%-owned subsidiary of AQL Aman, which in turn is a wholly owned subsidiary of SILK.

The group currently owns 18 vessels and the acquisition of the SOCs would increase SILK's earnings from its O&G support services division by around 50%.