MISC Doubles Quarterly Net Profit

Malaysia-based MISC Berhad, a shipping arm of Petronas, has more than doubled its net profit in the second quarter of 2015, mostly due to improved performance of the company’s petroleum shipping business.

The company reported MYR 772.6 million (USD 199.3m) net profit for the quarter ended June 30, as compared to RM 344.6 million (USD 88.9m) net profit in the corresponding quarter a year earlier.

MISC’s revenue for the quarter of MYR 2,6 billion was 2.4% higher than MYR 2,54 billion recorded in 2QFY2014.

The increase in revenue was mainly due to improved freight rates in petroleum business, revenue recognised from an Engineering, Procurement and Construction (EPC) project in the current quarter and finance lease income contribution of a Floating, Production, Storage and Offloading (FPSO) unit which commenced in September 2014.

Meanwhile, a smaller fleet of operating vessels in chemical business, lower earning days in LNG business and different phases of project construction in heavy engineering segment caused a decline in revenue of the respective businesses in the current quarter.

MISC says that its financial performance for the remaining quarters of 2015 will continue to be supported by secured recurring income from a portfolio of long term contracts in the LNG shipping and offshore business segments.

The company expects the strength in the petroleum shipping segment to be carried into the second half of the year, barring any material cutback in global oil production. Full year financial performance of the petroleum shipping segment is expected to show a marked improvement over the performance of 2014. However, chemical shipping prospects still remain mixed.