RNS Number:1353E
Plant Offshore Group Ltd
20 September 2007
20 September 2007
Plant Offshore Group Limited
Interim Results for the six months ended 30 June 2007
Plant Offshore Group Limited ('POGL' or 'the Company'), an AIM quoted company
that provides Engineering, Procurement and Construction Management ('EPCM')
services to the oil and gas, renewable energy and related industries, through
its wholly owned subsidiary Plant & Offshore Corporation Sdn Bhd ('POC'), today
announces its interim results for the six months ended 30th June 2007.
Highlights
* Revenue up 155% to RM35m (#5m) (2006: RM14m (#2m)).
* Profit from operations up 140% to RM7,414,000 (#1,087,000) (2006:
RM3,092,000 (#453,000).
* Profit before income tax up 142% to RM7,310,000 (#1,072,000) (2006:
RM3,025,000 (#443,000).
* Basic earnings per share up 131% to RM0.042 (0.61p) (2006: RM0.018
(0.26p).
* Cash flow from operating activities up 26% to RM756,000 (#110,000)
(2006: RM599,000 (#88,000).
* Successful listing on the AIM market on 9 July 2007 raising #2m.
* Contract with Global Bonanza Sdn Bhd to provide EPCM services worth RM44
million (#6.5m) for biodiesel production plant.
Mr Cho Nam Sang, Chairman of POGL, commented:
"We are delighted to have completed our successful listing on AIM in July, which
was an important milestone for POGL.
"Our strategy to concentrate on integrated, multi-discipline EPCM services is
proving fruitful. In the period under review the group won contracts worth in
excess of RM149 million.
"The Board is continually looking to add to our service offering, as evidenced
by our investment in a new Australian subsidiary, adding new technologies as
well as geographical reach. With our existing order book, current tenders in
place and continuing investment to provide the best possible solution for our
clients, we view the future with confidence."
For further information:
Plant Offshore Group Limited
Mr. Hang Chin Juan, CEO Tel: +603 7805 5001
hang_cj@plantoffshore.com www.plantoffshore.com
Mr. Kenneth Chai, Head of Corporate
Hoodless Brennan plc
Luke Cairns, Director, Corporate Finance Tel: +44(0)20 7510 8600
L.Cairns@HBcorporate.co.uk www.hbcorporate.co.uk
Threadneedle Communications
Josh Royston / Graham Herring Tel: +44(0)20 7936 9606
Chairman's statement
I am pleased to present the maiden interim results for POGL and would like to
take the opportunity to welcome our new shareholders since our listing. The
Company's admission to the AIM market on 9 July 2007 is an important milestone
and we are pleased to have completed the flotation successfully.
Throughout the six months under review the group won contracts worth in excess
of RM149 million and currently has tenders out for contracts worth a further
RM329 million.
These results reflect the significant impact of our strategy to move into
providing integrated, multi-discipline EPCM services. The company has managed to
secure larger projects to enable higher earnings. POGL continues to focus on the
provision of these EPCM services to the oil and gas, and renewable energy
industries as the potential for returns is significantly higher than with
generic engineering activities. As part of our development strategy to gain
access to new technologies and markets the group has recently established a
subsidiary in Perth, Australia to acquire process and facilities technologies
and also to provide the group's EPCM services into a wider market. POGL has a
51% holding in the subsidiary.
Plant Offshore Pte Ltd ('POPL'), the newly established subsidiary in Perth,
Australia will focus on the acquisition of process and facilities technologies
and also to expand POGL's reach in the provision of EPCM services. The areas
that POPL seeks to develop are Marginal Field Development, Floating Solutions,
Renewable Energy and Liquefaction Technologies, which have significant demands
in the Asian, Australian and the Middle East.markets. Australia has been
selected as it is a principal region in which considerable opportunities exist
for the acquisition and development of the above technologies. Potential
customers of POPL will be oil and gas and renewable energy consultants,
contractors, and exploration and production operators
The growing demand for our EPCM services in Malaysia and the South East Asian
Region, and sustained economic growth have benefited our business and this was
evident in the interim report. We look forward to developing the group further
in the second half of this financial year as we continue to grow our service
base into new and complimentary areas.
Financial performance
Group revenue, profit from operations and basic earnings per share for the six
months ended 30th June 2007 is substantially greater compared to that of
financial year ended 31 December 2006 all aided by the Group's move into full
EPCM services as illustrated by the positive contribution from the biodiesel
production plant project in Indonesia worth RM100m (#14.8m) awarded by Century
Corp Sdn Bhd during the period.
Group revenue increased by 155% to RM35m (#5m), profit from operations increased
by 140% to RM7,414,000 (#1,087,000), cash flow from operating activities
increased by 26% to RM756,000 (#110,000), basic earnings per share increased
131% to RM0.042 (0.61p).
Current trading and outlook
Progress since 30th June 2007 has been satisfactory with revenue and profits in
line with management's expectations. The group currently has ongoing contracts
and work in progress in excess of RM185 million, over the next 17 months. This
includes a contract with Global Bonanza Sdn Bhd to provide full EPCM services
for a 100,000 MTPY biodiesel production plant in Kuching, Sarawak. The contract
is worth some RM44 million (#6.5m) to POGL and was signed on 4th July 2007.
I am confident that the group will gain from the opportunities that lie ahead,
both in the current business and the new opportunities we are pursuing both from
a geographical and technological point of view. The board remains optimistic for
the second half of the year.
Finally, I would like to thank those who have been instrumental in POGL's
successful listing on AIM and involved with the Company's business and
operations for their hard work and I look forward to scaling greater heights
with you in the future.
Mr. Cho Nam Sang
Chairman, 20 September 2007
Consolidated Income Statement for the six months ended 30th June 2007
Six months Six months Year
ended ended ended
30th June 30th June 31st December
2007 2006* 2006*
Unaudited Unaudited Audited &
restated
RM000 RM000 RM000
Revenue 35,606 13,950 28,871
Cost of sales (26,487) (9,300) (19,987)
--------- --------- ----------
Gross profit 9,119 4,650 8,884
Other Operating income 43 48 141
--------- --------- ----------
Total income 9,162 4,698 9,025
Administrative expenses (1,412) (1,379) (2,740)
Other Operating expenses (336) (227) (457)
--------- --------- ----------
Profit from operations 7,414 3,092 5,828
Finance costs (104) (67) (167)
--------- --------- ----------
Profit before taxation 7,310 3,025 5,661
Taxation (1,071) (324) (776)
--------- --------- ----------
Profit after taxation 6,239 2,701 4,885
--------- --------- ----------
Attributable to:
Equity holders of the Company 6,239 2,701 4,885
Minority interests # # #
--------- --------- ----------
Profit for the period 6,239 2,701 4,885
--------- --------- ----------
Earnings per share - from continuing
operations and acquisitions
Basic RM0.042 RM0.018 RM0.033
--------- --------- ----------
Fully diluted N/A N/A N/A
--------- --------- ----------
Notes:
# Denotes amounts that are less than RM1,000
* Comparative of POC Group
Consolidated Balance Sheets
Six months Six months Year
ended ended ended
30th June 30th June 31st December
2007 2006* 2006*
Unaudited Unaudited** Audited &
restated**
RM000 RM000 RM000
Assets
Non-current assets
Property, plant and equipment 3,219 3,565 3,403
Goodwill 9,008 766 766
Development cost 3,583 1,523 2,692
--------- ---------- ----------
Total non-current assets 15,810 5,854 6,861
--------- ---------- ----------
Current assets
Trade receivables 30,198 8,354 9,012
Other receivables 3,245 206 111
Amount owing by contract
customers 1,397 276 1,008
Listing expenses 997 - -
Cash and bank balances 393 285 271
--------- ---------- ----------
Total current assets 36,230 9,121 10,402
--------- ---------- ----------
Total assets 52,040 14,975 17,263
--------- ---------- ----------
Current liabilities
Trade payables (21,021) (2,303) (1,991)
Other payables (639) (461) (576)
Amount owing to contract
customers (14) (628) (319)
Amount owing to directors (553) (558) (558)
Borrowings - secured (2,601) (1,427) (1,992)
Tax payable (1,815) (654) (756)
--------- ---------- ----------
Total current liabilities (26,643) (6,031) (6,192)
--------- ---------- ----------
Net current assets 9,587 3,090 4,210
--------- ---------- ----------
Non-current liabilities
Borrowings - secured (764) (1,020) (911)
Deferred tax liability (100) (57) (109)
--------- ---------- ----------
Total non-current liabilities (864) (1,077) (1,020)
--------- ---------- ----------
Total liabilities (27,507) (7,108) (7,212)
--------- ---------- ----------
Net assets 24,533 7,867 10,051
--------- ---------- ----------
Equity
Issued share capital 102 2,000 2,000
Share premium 10,140 - -
Retained profit 14,290 5,867 8,051
--------- ---------- ----------
Total equity attributable to
equity 24,532 7,867 10,051
holders of the Company
Minority interests 1 *** ***
--------- ---------- ----------
Total equity 24,533 7,867 10,051
--------- ---------- ----------
Notes:
* Comparative of POC Group
** The change in policy, in order to comply with the requirement of IFRS 3 -
Business Combinations, has resulted in the derecognised of the negative goodwill
with a corresponding increase in opening balance of Year 2006 unappropriated
profit of RM310,885
*** Denotes amounts that are less than RM1,000
Consolidated statement of cash flows
for the six months ended 30th June 2007
Six months Six months Year
ended ended ended
30th June 30th June 31st December
2007 2006* 2006*
Unaudited Unaudited Audited &
restated
RM000 RM000 RM000
Profit before taxation 7,310 3,025 5,661
Adjustments for:
Profit on disposal of property,
plant and equipment (17) (33) (33)
Depreciation 206 179 366
Interest expense 104 67 167
Amortization of development cost 71 71 142
Unrealised loss on foreign
exchange loss - - 19
Changes in working capital :
Increase in receivables (25,317) (1,880) (2,317)
Increase/(Decrease) in payables 19,093 (3,002) (3,345)
(Increase)/Decrease in amount
owing by contract customers (388) 2,470 1,737
Decrease in amount owing to
contract customers (306) (298) (607)
--------- --------- ---------
Cash generated from operations 756 599 1,790
Interest paid (104) (67) (167)
Income tax paid (21) (21) (320)
Net cash generated from --------- --------- ---------
Operations 631 511 1,303
--------- --------- ---------
Cash flows from investing activities
Purchase of property, plant and
equipment (58) (385) (470)
Proceeds from disposal of
property, plant and equipment 215 33 33
Addition to development cost (962) (499) (1,678)
--------- --------- ---------
Net cash used in investing
activities (805) (851) (2,115)
--------- --------- ---------
Cash flows from financing activities
(Decrease)/Increase in amount
owing to directors (5) 543 543
--------- --------- ---------
(Repayment)/Drawdown of short
term borrowings (68) (257) 522
--------- --------- ---------
Repayment of term loan (60) (58) (156)
--------- --------- ---------
Repayment of hire purchase
payables (254) (73) (113)
--------- --------- ---------
Net cash (used)/from financing
activities (387) 155 796
--------- --------- ---------
Net decrease in cash and cash
equivalents (561) (185) (16)
Cash and cash equivalents at
beginning of period/year 271 287 287
--------- --------- ---------
Cash and cash equivalents at end
of period/year (290) 102 271
--------- --------- ---------
Note:
* Comparative of POC Group
Notes to the Interim Report for the six months ended 30th June 2007
1. Significant Accounting Policies
(a) Basis of preparation and accounting policies - The financial information
contained in the Interim Results has been prepared in accordance with
International Financial Reporting Standards ('IFRS') as adopted by the European
Union. This Interim Report is the first consolidated financial report prepared
in accordance with IFRS. It has been prepared in accordance with IAS 34 -
Interim Financial Reporting and does not include all of the information required
for full annual financial statements. Full details of the accounting policies
adopted which are consistent with those disclosed in the Company's AIM Admission
Document will be included in the financial statements for the year ending 31st
December 2007.
(b) Pursuant to the application of the reverse acquisition principle in
accordance to IFRS3, the group's financial performance report for the current
interim was prepared in the name of POGL, but it represents a continuation of
the results of POC, which is deemed as the acquirer, and hence the comparative
information presented shall be that of POC.
(c) Revenue recognised for contract is in accordance to IAS 11 - Construction
Contracts. Where the outcome of a contract work can be reliably estimated,
contract revenue and contract costs are recognised as revenue and expenses
respectively by using the stage of completion method. The stage of completion is
measured by reference to the proportion of contract costs incurred for work
performed to date to the estimated total contract costs. Where the outcome of a
contract work cannot be reliably estimated, contract revenue is recognised to
the extent of contract costs incurred that it is probable will be recoverable.
Contract costs are recognised as expenses in the period in which they are
incurred. When it is probable that total contract costs will exceed total
contract revenue, the expected loss is recognised as an expense immediately.
The consolidated financial information is presented in RM (Ringgit Malaysia)
because the Group is expected to transact more of its business in RM (functional
currency) than any other currency.
The highlighted financial information has been translated using the following
exchange rate: RM6.8201 : #1 (average month-end exchange rate from January to
June 2007).
2. Nature of financial information
The financial information contained in this Interim Results for the six months
ended 30th June 2007 and 30th June 2006 are unaudited. The comparative figures
for the year ended 31st December 2006 have been abridged from POC's audited
financial statements (as restated due to the adoption of IFRS 3 as discuss in
the earlier section).
3. Taxation
The charge for income tax expense included in the Interim Results is based on
the unaudited results for the six months ended 30th June 2007 and is calculated
at the expected rate applicable to the group for the full year ending 31st
December 2007.
4. Earnings per share
Earnings per share is calculated by dividing the profit attributable to equity
shareholders in the period ended 30 June 2007 by the weighted average number of
shares in issue in the period.
The profit attributable to equity shareholders in the period ended 30 June 2007
was RM6,239,000 (30 June 2006 : RM2,701,000; year ended 31 December 2006 :
RM4,885,000). The weighted average number of shares in POGL in issue in the
period ended 30 June 2007 was 150,000,000, the weighted average number of shares
in the period ended 30 June 2006 and the year ended 31 December 2006 was using
the same weighted average number of shares in POGL in issue in the period ended
30 June 2007 of 150,000,000.
5. Contingent and other liabilities
No contingent liability or other liability of the group has become enforceable,
or likely to become enforceable as at the date of this announcement, which in
the opinion of the Directors, will or may substantially affect the ability of
the Company to meet their obligations as and when fall due.
6. Dividends
The Directors do not recommend the payment of any dividend in respect of the
current interim ended 30 June 2007.
7. Changes in Equity
Attributable to the equity
holders of the Company
---------------------------------------------------
Non-Distributable Distributable
--------------- -------------
Share Share Retained Minority Total
Capital Premium Earnings Total Interest Equity
RM000 RM000 RM000 RM000 RM000 RM000
At 1 January 2007 - - 8,051 8,051 # 8,051
Profit for the
financial period 6,239 6,239 # 6,239
Issue of shares 102* 10,140 10,242 1 10,243
-------- ---------- ---------- -------- -------- -------
At 30 June 2007 102* 10,140 14,290 24,532 1 24,533
-------- ---------- ---------- -------- -------- -------
Note:
# Denotes amounts that are less that RM1,000
* The share capital of POGL has been translated using the following exchange
rate: RM6.9179 : #1 (closing rate as at 30 June 2007)
Attributable to the equity
holders of the POC*
---------------------------------------------------
Non-Distributable Distributable
--------------- -------------
Share Share Retained Minority Total
Capital Premium Earnings Total Interest Equity
RM000 RM000 RM000 RM000 RM000 RM000
At 1 January 2006 2,000 - 3,166 5,166 # 5,166
Profit for the
financial period 2,701 2,701 # 2,701
Issue of shares -
--------- ---------- ---------- ------- -------- -------
At 30 June 2006 2,000 - 5,867 7,867 # 7,867
--------- ---------- ---------- ------- -------- -------
Profitfor the
financial period
(1 July to 31
December 2006) 2,184 2,184 # 2,184
--------- ---------- ---------- ------- -------- -------
At 31 December 2006 2,000 - 8,051 10,051 # 10,051
--------- ---------- ---------- ------- -------- -------
Note:
# Denotes amounts that are less that RM1,000
* Comparative of POC Group
Acquisition of POC
Pursuant to a Sale and Purchase Agreement dated 16 March 2007 the entire issued
and paid-up share capital of POC was transferred to POGL by its owners. The
consideration to the owners was the transfer of 2 existing ordinary share and
the allotment and issuance by POGL to the owners of 1,499,998 ordinary shares of
1p each. The acquisition was completed on 8th June 2007.
Subdivision of shares
On 22 June 2007, pursuant to a special resolution of the shareholders of POGL,
POGL subdivided the existing ordinary shares of 1p each into 0.01p each. Upon
the completion of the subdivision of shares, the issued and paid-up share
capital of POGL changed from 1,500,000 ordinary shares of 1p each to 150,000,000
ordinary shares of shares of 0.01p each.
8. Changes in the composition of the group
Acquisition of POC
The acquisition of POC by POGL, which was effected through share exchange (as
explained in note 7), was completed on 8th June 2007 and resulted in POC
becoming a wholly owned subsidiary of POGL.
9. Segment analysis
Six months ended Six months ended Year ended
30th June 2007 30th June 2006 31st December 2006
Unaudited Unaudited Audited &
restated
RM000 RM000 RM000
Revenue
EPCM 30,869 11,343 22,326
Supply of Specialists (SOS) 4,237 2,007 5,560
Engineering Design Software 500 600 985
TOTAL 35,606 13,950 28,871
10. Material events subsequent to the end of the quarter
On 9 July 2007, POGL issued 16,666,667 ordinary shares of 0.01p each at 12p per
shares per shares pursuant to the placing and listing exercise on the AIM market
of the London Stock Exchange and raised #2 million before expenses.
On 5 September 2007, POGL entered into an agreement to subscribe new shares in a
dormant company, which marks the establishment of POGL's new subsidiary in
Perth, Australia. The new subsidiary called POPL is 51% owned by POGL and will
focus on acquisition of process and facilities technologies and also to expand
POGL's reach in provision of EPCM services.
Note to Editors
POGL, admitted to AIM on 9 July 2007, is the group holding company of POC, which
owns Plant & Offshore Technology Sdn Bhd, Ikhtiar Intelek Sdn Bhd and Capital
Management Solutions Sdn Bhd.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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