Vallianz Q1 profit rises 12.5% on absence of impairment charge

Mr Ling Yong Wah, CEO of Vallianz Holdings.
Mr Ling Yong Wah, CEO of Vallianz Holdings. PHOTO: VALLIANZ HOLDINGS

SINGAPORE - Offshore support vessel provider Vallianz Holdings reported on Monday (Aug 14) a 12.5 per cent rise in first-quarter net profit to US$4.26 million from S$3.79 million a year ago, on the absence of an impairment charge of US$1.62 million in the year-ago period.

Revenue for the three months to end June fell 35.2 per cent to S$41.2 million, mainly due to the completion of various one-time vessel management projects in the second half of 2016.

Operating profit for the quarter slipped 18.2 per cent to US$4.9 million.

No dividend was declared for the period.

Vallianz said that while the group experienced lower utilisation for certain vessels outside of the Middle East region, this was mitigated by revenue contributions from ongoing long-term charters in the Middle East as well as the start of new long charter contracts during the quarter in review.

Said Vallianz CEO Ling Yong Wah said the group has been able to endure sluggish market conditions affecting other regions as its vessel chartering business is primarily anchored in the Middle East, and remained stable and profitable due to the long term nature of its charter contracts there.

As at June 30, the group's chartering services order book stood at approximately US$990 million, comprising mainly long term charters that stretch to 2025, including two-year extension options.

"Following the series of cost rationalisation, operations streamlining and restructuring initiatives, as well as an asset write-down exercise undertaken in the last financial year, we believe the group is better positioned to overcome current market challenges and focus on building our future," said Mr Ling.

He added: "With the strong support of its partner Rawabi Holding, the group intends to keep its sights on expanding business opportunities with existing customers and increasing penetration in other target markets in the Middle East and other regions. To this end, the group intends to leverage on its first inroads into Egypt and Turkmenistan to step up its presence in new markets."