KUALA LUMPUR: International offshore energy facilities and services provider Bumi Armada continued to stay in the red, posting net losses of RM2.30bil in the financial year ended Dec 31, 2018 and net losses of RM1.26bil in the fourth quarter.
In a statement released on Friday, it also announced Leon Harland, its chief executive officer (CEO), and executive director, will be concluding his contract of employment with the Company on May 15.
“Harland will be transitioning his leadership role tt Gary Neal Christenson,” it said.
Christenson, a member of the Board since May 2018, will be re-designated as executive director of on March 27, and will assume the CEO role, taking over from Harland, on May 16.
Highlights of its FY18 results:
Bumi Armada revenue RM2.4bill for FY18, similar to 2017.
The FPO business recorded revenue of RM1.7bil for FY18, higher than the RM1.4bil for FY17.
The OMS business registered revenue of RM724.8mil in 2018, lower than the RM969.2mil reported in 2017.
Operating profit for 2018 was RM301.9mil versus RM767.2mil in 2017.
The Company ended the year with a net loss of RM2.3bil for 2018, versus a net profit of RM352.2mil in 2017.
Firm orderbook at the end of 2018 was approximately RM20.2bil, with additional optional extensions of up to RM10.3bil.
The net loss of RM2.3bil was mainly due to the impairment of Armada Kraken FPSO and certain OSV vessels, allowances for impairment losses and higher finance costs.
Excluding the impairments and net allowance for impairments losses, the Group would have reported a net profit of RM216.5mil.
Comments by CEO Leon Harland:
The group faced a financially challenging year in 2018, which was largely marked by the difficulties encountered on the Kraken FPSO and the ongoing low utilisation of our OSV fleet.
As result, we have taken the impairments in both our FPO and OMS businesses on a prudent basis and this has resulted in a substantial loss to the group’s bottom-line.
In parallel, we have streamlined the organisation, resulting in a significant reduction in staff numbers, and have been continuing our efforts to sell our under-utilised assets.
We continue to review our OSV fleet requirements and have several vessels under discussion for disposal.
Going forward, the aim is to complete the refinancing of the group corporate debt in the near future, monetise assets and enhance the performance from Armada Kraken.