KUCHING: Ocean Vantage Holdings Bhd’s (OVH) revenue stream has been broadened with the re-activation of drilling rig charter services segment last year.
This segment generated revenue of RM1.3 million for the group in financial year 2023 (FY2023).
“The revenue from this segment reflects our strategic efforts to capitalise on emerging opportunity to broaden our service offering to meet evolving client needs,” OVH said in its 2023 annual report.
In FY2023, OVH group revenue grew by 9.41 per cent to RM169.69 million (FY2022:RM155.1 million), and this helped the group to return to the black with after-tax profit of RM3.51 million (- RM1.11 million).
Company’s chairman Nor Azzam Abdul Jalil attributed the revenue expansion to significant improvement in the EPC and Project Management (EPC) segment, which posted a 36.68 per cent increase in its turnover to RM84.63 million from FY2022.
The bulk of the revenue was derived from Bintulu Additional Gas Sales Facility 2 (BAGSF2) project.
He said the re-activation of the provision of drilling rig charter services segment had also contributed positively to the group’s overall revenue stream.
“Whilst there were slight revenue declines in the manpower supply and supply of materials, tools and equipment segments, our diversified revenue streams and strategic initiatives effectively mitigated potential impacts on overall revenue performance,” he added.
Nor Azzam said although the EPC segment was the largest revenue contributor to the group, it encountered challenges, particularly in maintaining profitability, with the BAGSF2 project leading to a negative gross profit margin of four per cent in the overall EPC segment.
“Despite the challenging economic environment, we were able to maintain overall gross profit margin, showcasing effective operational efficiency and cost control measures.
“Moving forward, corrective actions have been identified and implemented to enhance profitability in the EPC segment, ensuring OVH’s continued growth and resilience in the face of future challenges,” he added.
Nor Azzam said OVH is optimistic of its positive performance in FY2024 as Petroliam Nasional Bhd (Petronas) is boosting its upstream capital expenditure (Capex) this year, and this will benefit upstream service providers like OVH, potential resulting in heightened demand and enhanced margins for their services.
“In 2024, it is expected that Brent crude oil prices to average at US$84 per barrel, a level that should enable Petronas to increase its upstream spending significantly to counteract potential long-term declines in natural production.
It is expected that Petronas will allocate between RM50 billion to RM60 billion in Capex for the financial year ending 31 December 2024.
“With situation in mind, our group will maintain focus on executing key long-term strategies aimed at enhancing financial stability.
This involves leveraging our expertise and presence in the upstream oil and gas sector, alongside efforts to diversify our service portfolio.
“We will actively pursue opportunities to secure new customers and explore untapped regions, thereby expanding our market reach and ensuring sustained growth.”
He added:” We remain committed to exploring opportunities in the renewable energy (RE) sector, particularly in solar energy and electric vehicle (EV) infrastructure projects. We are continuously evaluating and refining our strategies in this regard.
We are actively exploring opportunities in the energy sector across the entire value chain, including oil and gas, renewable energy, power generation, electric vehicle ecosystems, infrastructure and more.”
