KUALA LUMPUR: Kencana Petroleum Bhd saw net profit for its 1QFY11 ended Oct 31 increase 31% from the preceding quarter to RM83.54 million from RM63.72 million due to the addition of a new subsidiary.
The company said its higher earnings were due to the full-quarter contribution from Allied Marine and Equipment Sdn Bhd (AME), which it acquired in July through a share swap arrangement.
Kencana also recorded strong improvement in its contracts on a bigger order book and the better management of the relevant costs.
Year-on-year, its net profit grew nearly 60% from RM52.36 million in the previous corresponding quarter. Meanwhile, revenue rose 69% to RM569.9 million from RM336.9 million a year ago.
AME was acquired for RM400 million in a share swap. It provides offshore diving and underwater-related services for the inspection, repair and maintenance of structures, pipelines and risers for the construction of underwater facilities for the oil and gas industry.
Kencana said in an earlier announcement that the acquisition of AME would enable it to earn recurring revenues and potential cost synergies.
AME has undertaken projects in Malaysia, Indonesia, Vietnam, China and India.
The acquisition came with a guarantee that AME’s audited consolidated profit after tax for each of the years ending Sept 30, 2011 and 2012 reach a minimum of RM40 million.
Last week, Kencana announced it had won a RM1 billion contract from Bechtel International Inc to fabricate and assemble a liquefied natural gas processing facility in Australia.
The company received a buyout offer from Integral Key Bhd for RM5.87 billion or RM4.60 per share, as part of a plan to merge Kencana with SapuraCrest Petroleum Bhd.
Both shares of Kencana and SapuraCrest reached a near four-month high yesterday. Kencana gained four sen to end at RM2.79 while SapuraCrest closed nine sen higher at RM4.41.
This article appeared in The Edge Financial Daily, December 15, 2011.
The company said its higher earnings were due to the full-quarter contribution from Allied Marine and Equipment Sdn Bhd (AME), which it acquired in July through a share swap arrangement.
Kencana also recorded strong improvement in its contracts on a bigger order book and the better management of the relevant costs.
Year-on-year, its net profit grew nearly 60% from RM52.36 million in the previous corresponding quarter. Meanwhile, revenue rose 69% to RM569.9 million from RM336.9 million a year ago.
AME was acquired for RM400 million in a share swap. It provides offshore diving and underwater-related services for the inspection, repair and maintenance of structures, pipelines and risers for the construction of underwater facilities for the oil and gas industry.
Kencana said in an earlier announcement that the acquisition of AME would enable it to earn recurring revenues and potential cost synergies.
AME has undertaken projects in Malaysia, Indonesia, Vietnam, China and India.
The acquisition came with a guarantee that AME’s audited consolidated profit after tax for each of the years ending Sept 30, 2011 and 2012 reach a minimum of RM40 million.
Last week, Kencana announced it had won a RM1 billion contract from Bechtel International Inc to fabricate and assemble a liquefied natural gas processing facility in Australia.
The company received a buyout offer from Integral Key Bhd for RM5.87 billion or RM4.60 per share, as part of a plan to merge Kencana with SapuraCrest Petroleum Bhd.
Both shares of Kencana and SapuraCrest reached a near four-month high yesterday. Kencana gained four sen to end at RM2.79 while SapuraCrest closed nine sen higher at RM4.41.
This article appeared in The Edge Financial Daily, December 15, 2011.
