KL Trader Investment Research Articles

Author: kltrader   |   Latest post: Tue, 10 Dec 2019, 10:08 AM


Serba Dinamik’s 2Q19 Profit Jumps 27%

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Yesterday, Serba Dinamik announced its financial results for the second quarter ended 30 June 2019 (2Q19), which saw its net profit surging 27% due to stronger revenue across all three business segments. The company’s share price, which rallied in the past two weeks, hit its record high at RM4.40 two days ago. Serba Dinamik declared a 2.7 sen dividend per share with ex-date on 13 September 2019.

O&M business segment – a major contributor to Serba Dinamik’s revenue

In its filing with Bursa yesterday (22 Aug), Serba Dinamik mentioned that the company recorded strong revenue with a 41.6% surge from last year due to strong activities from one of its business segments, the Operation and Maintenance (O&M) segment, which contributed 83.6% of its overall 2Q19 revenue. The increase was due to heightened activities from its maintenance, repair and overhaul (MRO) activities in Malaysia, Indonesia and Middle East region including Qatar, UAE, Bahrain. The O&M includes MRO of rotary equipment, inspection, repair and maintenance of static equipment and structure, maintenance of process controls as well as instrumentation and other related services.

In the filing, Serba Dinamik mentioned that the company still foresees the O&M business segment to remain as the company’s major revenue contributor in light of various new contract wins and renewal of existing contracts in the first half of this year.

Meanwhile, Serba Dinamik’s other two divisions which are engineering, procurement, construction and commissioning (EPCC) as well as other products and services also showed improved performance which was supported by its chlor-alkali plant in Tanzania and software development works carried out in Qatar (The Edge Markets, 22 Aug).

Despite the volatility in oil prices, fueled by uncertainty about the world economy and the impact on global oil demand, Serba Dinamik said that the maintenance works are still required especially in the mid and downstream sector. Therefore, the company is still actively engaging and participating in various bids to capture more market in the maintenance space.

Announced 2.7 Sen Dividend Per Share

The company has declared a second interim single-tier tax-exempt dividend of 2.7 per share which will be paid on 30 Sep 2019. The entitlement date for the dividend is 17 Sep 2019.

Source: Macquarie Research - 23 Aug 2019

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