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PACIFIC Radiance reported on Thursday that its net profit for the third quarter ended Sept 30, 2015, tumbled 87 per cent to US$1.7 million due to weaker performance from its subsea and offshore support services businesses.
Revenue fell 24 per cent, or US$10.6 million, to US$33.8 million. Its subsea operations suffered a 57 per cent fall in revenue to US$2.5 million. Revenue from its offshore support services eased 13 per cent to US$27.8 million.
The weaker revenue was due to the lower utilisation of vessels from its subsea business and support services businesses as a result of the softer market conditions in Q3.
The company's other operating income fell by about US$5.4 million, or 41 per cent, to US$7.8 million, due to the decline in gain on sale of vessels of US$5.0 million, by 44 per cent, from US$11.5 million a year ago to US$6.5 million in Q3. Two vessels were sold in both Q3 2014 and Q3 2015.
Pacific Radiance saw its share of results of joint ventures drop by US$2.6 million, or 94 per cent, to US$0.2 million from US$2.8 million a year ago, due to the decrease in the share of results of PT Logindo as a result of softer market conditions.
Pacific Radiance said market conditions for the oil and gas sector are expected to remain depressed for at least the next few quarters.
In light of this, it said it has intensified prudent balance sheet management; and deployed extensive cost management measures.
"These will continue to be the mainstay of the group's focus in the medium term. Concurrently, the group has and will continue to plant its marketing and business development seeds in emerging markets in order to build new markets as well as grow existing ones.''
It stays committed to the oil and gas sector as it believes that the spending cut in exploration and development activities is likely to lead to an eventual reduction in supply capacity, given the depletion rate of existing reserves together with the continually sustained level of global demand for fossil fuels.
"Global population growth and urbanisation will continue to drive demand for energy consumption and this provides the tail wind for the industry as a whole in the long run,'' it said.