MTQ Corporation plans unchanged dividend despite 78% plunge in profit

SINGAPORE - Oilfield engineering and engine systems provider MTQ Corporation has announced an unchanged final dividend of two cents per share.

This was even as the firm logged a net loss of $6.53 million fourth quarter to March 31, well down from the net profit of $5.5 million in the same period last year.

This as due to a $6.8 million goodwill impairment charge of from its Binder and engine systems businesses, said MTQ in a statement on Monday.

Excluding the impairment, net profit would have been $0.3 million, it added.

Revenue dropped 19 per cent to $63.76 million, on the back of weaker demand from oilfield engineering services in Singapore and Binder.

For the full year, net profit slumped 78 per cent to $5.47 million, while revenue dipped 6 per cent to $295.64 million.

Gross profit declined 11 per cent to $92.7 million, in line with lower revenue, as gross profit margin contracts to 31.3 per cent, lower than the 33.1 per cent the year before.

MTQ posted a loss per share of 4.22 cents for the quarter, compared with the earnings of 3.61 cents previously, while net asset value per share was at $0.83 as at Mar 31, lower than the $0.86 from the same time last year.

Earnings per share for the full year came in at 3.27 cents, well down from the 15.8 cents previously.

Group chief executive Kuah Boon Wee noted that the market outlook has "turned negative for our oil and gas activities", in line with lower oil prices.

"The Singapore oilfield and Binder businesses are suffering from reduced activity levels and significant improvements are not expected in the short term," he said. "However, our Bahrain business has delivered an encouraging performance on the back of improving margins and growing market share."

Added Mr Kuah: "While oil prices will recover, we anticipate that overall capital expenditure in our industry will reduce this year. Our focus will be on securing service opportunities as work on existing projects will continue. We will remain vigilant on addressing our cost structure."

MTQ shares closed two cents up at $0.78 on Monday.