Revenue contribution from the Drilling Services business, which accounted for 43.4% of the company’s revenue, rose by 36.2% from 38.7 million to $52.7 million. The balance of $68.7 million comprises revenue contribution from its Distribution Business, which saw a marginal decrease of 0.4% from $69.0 million to $68.7 million and accounted for 56.6% of the company’s revenue.
Operating expenses were lower this quarter due to the implementation of cost containment across the company. Other operating expenses reported a 205% increase mainly due to higher depreciation charges, which amounted to $7.1 million and foreign exchange loss of $0.6 million in first quarter of 2009 compared to an exchange gain of $3.3 million in first quarter of 2008.
At the close of the quarter, the company’s net gearing stood at 0.69 times compared to 0.76 times as at December 31, 2008.
The share of results of associates was lower by 81.8% due to the lower profit contribution from SSH Corporation Limited, an associate company of its subsidiary, Aqua-Terra Supply Co, Limited.
Share of results of jointly controlled entities rose significantly from $0.3 million to $9.4 million mainly due to the proceeds from the insurance claim on KS Titan 1.
Operating activities generated a net cash inflow of $17.1 million compared to $2.8 million in the previous financial year. At the close of the quarter, cash and cash equivalents amounted to $70.6 million compared to $68.3 million as at December 31, 2008.
Commenting on the company’s prospects, Kris Wiliuan, Chairman and Chief Executive Officer said: “Going forward, our Distribution Business will remain a key revenue contributor as it continues to fulfill the repairs and replacements needs of the oil and gas industry. The Drilling Services business will work towards expanding its capabilities in the renewable energy industry, an area that has abundant growth prospects. We expect our drilling business to grow. To ensure that we monitor our business vigilantly, we have recently restructured the Board and set up a Management Board as well as an Advisory Board. With this strategy, our management will focus on our business management, stay vigilant and monitor our business closely during this challenging operating climate.”
