KUALA LUMPUR (Aug 21): Deleum Bhd (KL:DELEUM) reported an 130% increase in second-quarter net profit, driven by stellar performance of the power and machinery and oilfield integrated services segments, coupled with foreign exchange gains and a reversal of impairment on trade receivables.
Net profit for the quarter ended June 30, 2024 (2QFY2024) rose to RM22.4 million or 5.57 sen per share, from RM9.73 million or 2.42 sen per share a year earlier, according to the oil and gas services provider in an exchange filing on Wednesday.
This is the highest quarterly earnings Deleum has reported since its listing on the Main Market of Bursa Malaysia in 2007.
The group declared a first interim dividend of four sen, up from two sen a year earlier, payable on Sept 30.
Quarterly revenue climbed 20.1% to RM225.9 million from RM188.1 million. The power and machinery segment saw a 12% year-on-year increase in revenue to RM176.6 million from RM155.3 million, contributing 78.2% of total revenue.
The oilfield integrated services segment experienced a 50.7% increase in revenue to RM49.1 million from RM32.6 million, due to higher business activities in slickline services in East Malaysia, asset-integrated solution services, and solid control services.
For the first half ended June 30, 2024 (1HFY2024), Deleum’s net profit grew 67.7% to RM31.6 million from RM18.9 million for the previous corresponding period, while revenue increased 24.3% to RM387.3 million from RM311.5 million.
Looking ahead, the group said it is encouraged by the continued recovery in global oil demand, which supports a resilient outlook for the oil and gas industry.
It said it remains focused on sustainable growth through strategic initiatives, digital solutions, and innovative technologies, while pursuing acquisitions to strengthen its market position.
“We continue to see strong performance in our power and machinery segment, and a significant rebound in our oilfield integrated services segment. These improvements are expected to significantly contribute to our overall performance in FY2024,” the group added.
Deleum said its order book currently stands at RM570.5 million, with the majority of work and equipment scheduled for delivery within the next 12 months.
“Our strategic focus on growth and operational excellence is paying off," said Deleum group chief executive officer Ramanrao Abdullah. "Our strategy includes prioritising quality mergers and acquisitions, investing in innovation and technology, and exploring collaborations aligned with our goals. With a strong order book and an improving industry outlook, we remain optimistic about achieving sustainable growth.”
Deleum shares rose four sen, or 3.3%, to RM1.25 at Wednesday’s market close, valuing the group at RM501.9 million. Year to date, the stock has risen 30.9%.