SINGAPORE - Gaylin Holdings' fourth-quarter net loss widened to $44.4 million, or 6.13 cents per share, from a year-ago $6.3 million after the oil and gas contractor took a $35.5 million provision for slow-moving and aged inventory.
For the full-year ended March 31, 2018, the company incurrFed a net loss of $51.6 million, or 10.14 cents per share, a deeper loss than the year-ago deficit of $11.4 million.
Fourth-quarter revenue shrank 28.1 per cent to $15.5 million as sales in the rigging and lifting segment fell $5.8 million to $11.9 million.
The company made a significant provision for slow-moving and aged inventory in view of the downturn in the oil and gas industry. The provision was based on a review by professional valuers on the net realisable value of the inventories based on suppliers' pricing, market demand and obsolescence, the company said. Excluding provision for slow-moving and aged inventory, gross profit margin for the fourth quarter would have improved to 15.9 per cent from a year-ago 12.8 per cent.
Despite the loss, Gaylin has strengthened its cash position over the past year, mostly on the back of a $68 million equity injection by private equity firm ShawKwei & Partners. Cash and cash equivalents grew to $57.8 million as at end-March, from $6.6 million a year earlier. Cash surpassed total debt by $0.7 million, compared to a deficit of $76.4 million a year ago. That was the first time that the company had a positive balance since 2012, the company said.
Looking ahead, Gaylin noted increasing optimism in the global oilfield services market amid rising oil prices.