MISC group financial results for the year ended 31 december 2018

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MISC is pleased to announce its financial results for the financial year ended 31 December 2018.
Financial Highlights:

 Group revenue for the quarter and the year ended 31 December 2018 were lower than the
corresponding quarter and year ended 31 December 2017.
 Group profit before tax for the quarter ended 31 December 2018 was higher than the
corresponding quarter ended 31 December 2017.
 Group profit before tax for the year ended 31 December 2018 was lower than the corresponding year ended 31 December 2017.

MISC’s President/Group Chief Executive Officer, Mr. Yee Yang Chien said “Volatile market conditions continue to affect the players in the industry on a global scale. In the face of this challenging market, MISC has proven its strength and capability in securing investment growth of
more than USD900 million. Our financial stability is further affirmed when we recorded strong credit ratings in the maritime sector with Moody’s Investors Service, affirming a Baa2 issuer rating and S&P Global Ratings affirming a BBB+ long term corporate credit rating. This reflects MISC’s
resilience as well as our ability to consistently create optimum value to our stakeholders.”

“We believe that business and operational performance go hand in hand for us to consistently provide better energy related maritime solutions and services. As a testament to our consistent efforts in enhancing operational excellence, we have been recognised at the Lloyd’s List Global
Awards 2018 as the Tanker Operator of the Year. This recognition will spur us to go further in accelerating our efforts to serve our customers,” Mr. Yee Yang Chien added.


Moving Forward


The petroleum tanker spot market ended the year 2018 on a firmer note after a fragile start.However, 2019 is projected to be still another challenging year for tanker markets. Growth inseaborne oil demand is expected to be impacted by the recently announced OPEC-led productioncuts, and geopolitical uncertainty continues to cloud future energy demand. Over the longer term,growth in tonne-miles that is driven by higher exports from the Atlantic region to Asia suggests amore robust outlook in charter rates.

The LNG segment is expected to continue to benefit from the market strength seen in 2018 goinginto 2019, supported by demand growth in Asia, additional supply from new liquefaction projectsand slower LNG fleet growth in 2019. While the LNG spot rates reached a multi-year peak in late2018, the sustainability of such rates remain uncertain in 2019. Nevertheless, the existing portfolioof long term charters that are in place will underwrite a steady performance for MISC’s LNGshipping unit into the next financial year.

The offshore segment continues to be supported by healthy activities in oil and gas exploration andproduction. An increasing number of floating production system contract awards are forthcomingin the next few years and MISC’s Offshore business unit will be actively pursuing theseopportunities. The two new assets added in 2018 will provide a source of income growth andsupport the financial performance for the unit in 2019.

The Heavy Engineering segment is not expecting further deferment by ship owners for dry -dockingactivities in the coming year in view of the forthcoming implementation of new rules by InternationalMaritime Organisation (IMO). In 2018, the segment had secured a number of long term offshorefabrication frame agreements which are on a call-out basis.

These are expected to contributepositively to the segment’s revenue in 2019 and beyond. The Heavy Engineering segment remainscommitted to replenish its order book, and efforts to ensure competitiveness of ongoing and futurebids remains a priority.