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Marco Polo back in the black in Q2 on derecognised debts

MARCO Polo Marine was back in the black in the second quarter, mainly bolstered by derecognised debts after wrapping a months-long restructuring exercise.

The offshore support vessel operating and yard operating counter posted a net profit of S$173.53 million for the three months ended March 31, 2018, reversing from a loss of S$8.16 million for a year-ago period.

Second quarter revenue went down by 41 per cent to S$7.63 million, but this was more than offset by a 46 per cent decrease in cost of sales to S$6.66 million.

As a result, the group posted a 77 per cent increase in Q2 gross profit to S$969,000.

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Other operating income surged to S$180.06 million, up from S$354,000, on derecognised debts.

The group completed its debt restructuring exercise on Jan 25, 2018, which saw its debt pile shrink dramatically.

Correspondingly, its finance costs fell 44 per cent to S$1.1 million.

First half profit was S$166.89 million, compared to a loss of S$4.77 million for 1H FY2017.

Earnings per share for H1 was 11.19 Singapore cents, compared to a loss of 1.42 Singapore cents for the corresponding six months in FY17.

Net asset value per share was back in positive territory at 3.24 Singapore cents as at March 31, 2018, compared to negative 45.4 Singapore cents a year ago.

But the group still has some way to go to turn around its operations. Net cash outflow from operating activities widened to S$3.63 million as at the end of first half, from S$1.62 million for the corresponding six months last year.

The group acknowledged that the offshore marine business "remains challenging and competitive for the next 12 months", adding that it will "remain prudent in managing and monitoring its expenses".

Marco Polo closed at three Singapore cents, down 0.3 Singapore cent.