Vallianz Holdings posts 11.1% rise in Q4 profit

VALLIANZ Holdings Limited on Monday said its fourth quarter net profit rose 11.1 per cent year on year to US$4.1 million, even as revenue slid 2.5 per cent to US$47 million.

For the full year though, the offshore support vessels (OSV) and integrated marine solutions provider posted a 6.1 per cent drop in net profit to US$17.5 million, due to difficult operating conditions in the offshore marine industry as well as an increase in tax expenses.

Revenue in 2015 grew 51.3 per cent to US$232.6 million, driven by higher chartering and brokerage revenue in tandem with the growth of the group's fleet size.

The higher revenue also came from ship management and shipyard services, mainly attributable to contributions from Jetlee Group, OER Group and Newcruz, which were acquired in the last quarter of FY2014.

Correspondingly, cost of sales in 2015 grew to US$167.6 million, up 70.2 per cent.

Tax expense increased from US$1.17 million in FY2014 to US$5.40 million in FY2015 due to expanded scale of operations and an increase in deferred tax liabilities.

A first and final dividend of US$0.0005 per share was declared.

In its outlook, the group said business conditions in the offshore marine industry are expected to remain challenging in the near term due to the current depressed state of the global oil market.

Despite this, Vallianz said it is one of few OSV providers that continued to secure long-term charter contracts, which has enabled the group to substantially increase its current chartering services order book to US$950 million, which comprise mainly long-term time charters stretching up to 2022, as compared to about US$540.0 million at the end of December 2014.

In addition, the group said it attained a healthy fleet utilisation rate of 81 per cent in 2015.

It has deployed the second self-elevating platform vessel with an existing state-owned customer in the Middle East in Q4 2015. The vessel is part of the time charter contract secured in July 2015 for the supply of two self-elevating platforms vessels.

Its offshore floating storage and supply vessel (OFSSV) is expected to commence operations with the customer in the current quarter ending March 31, 2016. The group also expects to deploy four Anchor Handling Tug Supply vessels for the customer's offshore projects by the end of Q1 2016.

In February 2016, the group completed a refinancing exercise of its operations in the Middle East, thereby lowering cost of funding and improving cash flow.

Vallianz said it is presently bidding for charter contracts with a combined value of US$1.80 billion mainly for projects located in the Middle East.