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The Group recorded a higher revenue of RM49.8 million and a loss before taxation of RM13.7
million in the current quarter, as compared to a revenue of RM45.2 million and a loss before
taxation of RM77.5 million in the preceding quarter.
The slight increase in revenue in the current quarter is mainly due to higher vessel utilization at
70% as compared to 63% in the second quarter of 2017. The higher vessel utilization is a result
of improved work orders/contracts awarded from the oil majors during the third quarter of 2017.
On the other hand, the higher loss before taxation incurred in the preceding quarter is mainly
attributed to impairment loss on property, plant and equipment of RM50.4 million as well as net
realized/unrealized foreign exchange loss of RM16.5 million, as compared to a net
realized/unrealized foreign exchange loss of RM7.9 million in the current quarter. The loss after
taxation in the current period had taken into account both current and prior year tax expenses
amounting to RM5.3 million (see Note 20)

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Stock: [DAYANG]: DAYANG ENTERPRISE HOLDINGS BHD

2017-11-21 13:45 | Report Abuse

18. Prospects
Generally, the offshore support vessels (“OSV”) market in the first three quarters of 2017 has
been weak and for the last quarter of 2017, the Board envisages that the Group’s vessel
utilization will continue to remain sluggish in view of the impending monsoon. However, going
into 2018 it is expected that the Group’s vessel utilization rate will be better than that of 2017 as
a substantial number of the Group’s fleet will be earmarked for Dayang’s offshore maintenance
and hook-up contracts with various oil majors where activities are already projected to be
ramping high.
Currently, the few remaining vessels which are not earmarked for Dayang’s jobs are participating
in bids for the OSV contracts domestically, regionally and also in international markets and the
outcome of these tenders are still pending.
Also, with the price of crude oil currently hovering near USD60 per barrel, the Board is more
optimistic that sentiments should improve going forward.
The Group’s ongoing cost containment exercise to cut-cost is yielding result with improved cost
efficiency.
The relisting plan of the Company which is targeted to be completed by end of November 2017
and the issuance of new shares via private placement to regularise the public shareholding spread
is also ongoing, all boding well for the Group if completed. The proceeds of this corporate
exercise once completed will be utilized to pare down bank borrowings and improve the Group's
gearing level, reduce its interest expenses, and add financial flexibility to its operational cash
flow management.
In view of the above, despite the dilution of EPS of the Group and dilutive effect on the existing
shareholders’ shareholdings, the private placement exercise is expected to have a positive impact
on the earnings of the Group when the benefits are realized, which will then directly enhance
shareholders’ value.
Although the Board is well briefed of the Group’s outlook and prospects and the better things to
come by the management, the Board remains cautious and vigilant in its pursuit for more longerterm
charter opportunities and will continue to exercise due care in their endeavours.