KUALA LUMPUR (Feb 28): Provision for doubtful debts and higher costs caused Eversendai Corp Bhd to slip into the red with a net loss of RM193.08 million for the fourth quarter ended Dec 31, 2016 (4QFY2016), compared with a net profit of RM7.29 million a year earlier.
Revenue dropped 30.3% to RM340.97 million from RM489.32 million in 4QFY2015.
For the full financial year, Eversendai suffered a net loss of RM257.50 million, compared with a net profit of RM55.37 million in FY2015, due to provisions and impairments on fair value of financial assets, provision of doubtful debts, higher costs and low utilisation of the fabrication facility due to the slow recovery of the oil and gas industry.
“This is the first year the company is recording a loss owing to both internal and external factors,” said Eversendai managing director Tan Sri A K Nathan.
“The group has since identified all shortfalls, re-strategised and aligned towards moving out of the losses incurred during the financial year of 2016 with progressive profits projected from the 1st quarter of 2017 onwards,” he said in a statement.
Revenue for FY2016 dipped 11.97% to RM1.57 billion from RM1.79 billion in the previous year.
Of the revenue, 62.1% was contributed by the businesses in the Middle East region, 14.3% by operations in Malaysia, 9.7% by operations in India, 13.4% from the oil and gas segment and the remaining 0.5% from operations in Thailand, the group said.
“To date the group has secured projects worth RM801.4 million for the year 2017, of which RM117.4 million is from the oil and gas sector, bringing Eversendai’s orderbook to approximately RM3 billion,” it added.
The group said it secured RM1.8 billion worth of jobs for FY2016.
On prospects, the group said it is confident to achieve higher revenue and profitability moving forward, particularly with the recovery of the oil and gas industry.
“It has been a tough year for the group, but we are confident we will achieve our target working progressively towards declaring profits.
“The recovery in the oil and gas industry will give us a good push to improve the business further. We know it is going to be upward trends for the Eversendai Group from here on,” said Nathan.
At 4.33pm, Eversendai fell 11 sen or 17.19% to 53 sen, for a market capitalisation of RM456.6 million. — theedgemarkets.com