KUALA LUMPUR (Sept 27): Bursa Malaysia’s Energy Index rose as much as 19.78 points or 2.78% to 731.32 this morning, becoming the top percentage gainer among bourse gauges, after oil prices hit three-year highs. At 10.19am, the index, which tracks share prices of oil and gas (O&G) related companies, settled at 727.82, still up 16.28 points or 2.29%. KNM Group Bhd, which was the most actively traded stock, gained as much as 2.5 sen or 10.87% to 25.5 sen. At 10.19am, the counter had pared some gains at 25 sen, still up two sen or 8.7%, with 73.69 million shares traded. Meanwhile, Bumi Armada Bhd increased by one sen or 2.27% to 45 sen; Perdana Petroleum Bhd grew half a sen or 4.35% to 12 sen. Reuters reported that oil pushed past its July peaks as global output disruptions forced energy companies to pull large amounts of crude out of inventories, while a shortage of natural gas in Europe pushed costs up across the continent. At the time of writing, Brent crude oil had added US$1.26 to US$79.35 (about RM332) a barrel, while West Texas Intermediate crude was US$1.21 higher at US$75.19. ""Supply tightness continued to draw on inventories across all regions," ANZ Research said in a note quoted by Reuters. Rising gas prices also helped drive oil higher as the liquid became relatively cheaper for power generation, ANZ analysts said in the note.
DAYANG may continue drifting lower? with oil price, anybody watching REACH? one of cheapest oil counter and below radar. tiny mcap and actually producing oil
Board on and ride the vroommm-ing black gold sea .
An Quick Flash of Dayang :
a. 15 March 2021completed its 10% P.P. at $1.37 per share .(Brent was around $65.00) b. Vessel utilisation stronger at 51% vs 20% in the first quarter of 2021. c. The outlook in 3rd quarter of 2021 will improve considerably as crude oil price has improved significantly. d. Order book remains strong at an estimated value of RM2.3 billion, which will ensure healthy earnings visibility over the next few years.
I trust, Dayang shud be able to reap above $100mil net profit by fy2022. Petronas s shall increase more capex given Brent oil has traded > $75 to 80above. That, certainly will benefit Dayang by 2022 .
Given Dayang today closing $0.99 vs its P.P. price $1.37 Thats a good safety of margin by 28% discount.
Seasonality due to weather, the offshore topside maintenance operations are normally affected by bad weather at the beginning and the end of the year . Due to the above, Dayang s quarter2 will has its weakest qtr. of performance.
Thus, its the golden time to collect at lower price.
Caution on further impairment. Recent results saw an impairment loss amounting to RM27.9m (RM29m owing to Perdana). Given the current operating climate and uncertainty in project execution, management cautions on further impairments in the coming quarters though with potential write-backs at the end of the reporting period. The Group has adopted value-in-use estimations which entail discounting the estimated future cash flows of assets, taking into account the current vessels’ utilisation and charter rates. Based on orders in hand, management guided that utilisation rates for 3Q and 4Q will be c. 70% on average.
Better year ahead. We understand that Dayang has achieved 100% vaccination rate for its workers. Hence, the on-going discussion involving Petronas, Health Ministry, and state government of Sarawak with regards to the movement restrictions (relaxation on quarantine period) is expected to bear positive outcomes in the near term. Therefore, FY22F earnings are anticipated to be robust, supported by healthy orderbook of RM2.3bn and improved profit margins. The increase in the availability of work orders will continue with higher capex spending by oil majors. We note that Petronas’ 2QFY21 capex was disappointing mainly due to project delays caused by movement restriction.
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WOW!...
"Based on orders in hand, management guided that utilisation rates for 3Q and 4Q will be c. 70% on average."
From below extract of Qtr 4 end Dec 31 - 2019, and the PAT reported for 2019, we can see that 70% utilisation can easily deliver about 60 m PAT per qtr
B3. Prospects ...........
Financial year 2019 has indeed turned out to be a great success as we achieved the best ever annual profits in the long history of Dayang. In spite of the external uncertainties and multiple headwinds from all directions, we have grown from strength to strength to hit the significant milestone, registering a massive 44% growth for our 2019 profits after a stellar performance in 2018. The strong growth momentum has been envisaged as we maintained and carefully executed our business plan throughout the year.
This remarkable achievement comes on the back of the robust work orders for the Maintenance, Construction and Modifications Contract (MCM) and Topside Maintenance Services works under the Pan Hook-up and Commissioning Contract (Pan HUC). Consequently, vessel utilisation also came in stronger at 70% for 2019, as compared to 64% in 2018.
(d) When does the Company plan to start this venture and what is the expected CAPEX?
Dayang is currently evaluating potential partners who have expertise and solid track record in Decommissioning and Modular Structural works. These ventures are targeted to begin in Q1 of 2021 with estimated CAPEX requirement of RM30 million.
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Decommissioning will intensify in the future for Petronas...
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
UnicornP
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Posted by UnicornP > 2021-09-22 11:33 | Report Abuse
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