SINGAPORE - Offshore and marine group Kim Heng saw an improved second half on the back of higher energy prices and growing demand for renewables in North-east Asia.
Losses for the six months ended December 31 narrowed to $2.2 million, from $4.1 million a year earlier. Revenue for the July-December 2021 period grew 72 per cent to $34.3 million, from $20 million a year ago.
For the full year, the company posted a loss of $5.9 million compared with $5.3 million a year earlier. Revenue was up 68 per cent to $63.2 million, from $37.6 million a year earlier.
Gross profit margin widened from 20 per cent in FY2020 to 25 per cent in FY2021.
The loss in FY2021 was largely due to depreciation of property, plant and equipment and right-of-use assets of some $7.2 million.
Earnings before interest, tax and amortisation was positive to the tune of $5.4 million.
Net cash generated from operating activities before changes in working capital amounted to $5.3 million. The overall net cash generated from operating activities after changes in working capital and income tax paid amounted to $3.7 million.
The company said charter rates and utilisation of its fleet have improved significantly in FY2021, and said it expected this robust level of charter income to continue moving forward in FY2022.
"Oil prices have steadily increased with geopolitical tensions, and we do expect charter income to increase due to higher day rates," it added.
The price of oil has risen some 20 per cent this year to a seven-year high, which may mean increased demand for the services of offshore and marine players like Kim Heng.
But the company has also been building up its portfolio in the renewable business, especially in wind farms in North-east Asia. This has grown significantly over the last three years.