Nam Cheong narrows Q4 loss to RM5.6m from RM21.5m a year ago

A diesel electric platform supply vessel being built at Nam Cheong’s 12.6 ha Miri shipyard located in Kuala Baram, Sarawak, Malaysia.
A diesel electric platform supply vessel being built at Nam Cheong’s 12.6 ha Miri shipyard located in Kuala Baram, Sarawak, Malaysia. PHOTO: NAM CHEONG

SINGAPORE - Offshore vessel builder Nam Cheong reported a net loss of RM5.6 million (S$1.8 million) for the fourth quarter ended Dec 31, 2016, less than the loss of RM21.5 million for the same period a year ago.

Revenue for the quarter halved to RM120.3 million from RM241.8 million. This was mainly due to a 52 per cent fall in contribution from the shipbuilding segment due to Perdana Petroleum Berhad's cancellation of a second accommodation work barge.

The Malaysian company posted a loss per share of 0.27 sen for the quarter compared to a loss of 1.02 sen a year ago.

For full-year 2016, Nam Cheong sank to a net loss of RM42 million from a profit of RM28.5 million a year ago as revenue tumbled 82 per cent to RM170.4 million.

The shipbuilding segment saw revenue tumble 84 per cent to RM146.4 million, mainly due to the number of vessels delivered in 2016 dropping to two versus 11 units in 2015.

The vessel chartering segment also saw revenue fall 46 per cent to RM20.4 million in 2016, mainly due to lower utilisation rates.

Nam Cheong said the outlook for the offshore and marine sector remains weak and the group anticipates the progress of vessel sales and shipbuilding to remain slow.

In response to the challenging business environment, it has deferred the schedule of deliveries of its vessels currently under construction, both at customers' requests and also on its won initiative.

No dividend was recommended for the quarter, unchanged from the previous year.