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Ezion's Q1 profit slips 9.4% on challenging operating environment (Amended)
EZION Holdings reported on Wednesday that its net profit for the first quarter ended March 31, 2015 slipped 9.4 per cent to US$41.01 million from US$45.2 million.
Revenue fell 4.6 per cent to US$90.12 million due mainly to the absence of contribution from the marine and offshore logistic support services division as the projects in Queensland, Australia did not go into additional trains as originally planned.
Ezion said the operating environment has been made challenging following the drastic drop in the prices of fossil fuel over the last seven months. Several of its service rigs have been made to work at their limits resulting in more wear and tear and higher maintenance. In addition, the group also needed to incur additional cost to further upgrade a few of its newer units to meet clients' additional requirements.
"The management has been putting in maximum effort to address these new challenges,'' Ezion said.
Based on the current schedule, a few units of the service rigs which are under maintenance and dry docking inspection are expected to be redeployed before the end of June. Similarly, several other new units that are undergoing modification are also expected to be progressively deployed starting from the same period.
The management is cautiously optimistic that the group expects to have stronger performance for the remaining of the year when some of the units are redeployed and new units are delivered.
Amendment note: An earlier version of this story stated that Ezion Holdings' net profit for the first quarter ended March 31, 2015 slipped 9.4 per cent to US$41,010, from US$45,245. Net profit actually slipped to US$41.01 million from US$45.2 million.