The challenging economic conditions and oil price crisis rendered Deleum’s pre-tax profit lower by 22.7% as compared to the corresponding period in 2014, hence, lower contributions from its business segments.
In line with this, for FY2015, the Power and Machinery (P&M) segment reported a pre-tax profit of RM 63.8 million, 1.2% lower compared to the corresponding period due to lower revenue contribution, whilst the Oilfield Services segment posted a pre-tax profit of RM8.3 million, logging a lower result as compared to the corresponding period. This was mainly due to the compressed margin from slickline activities and higher depreciation and borrowing costs on slickline assets. In addition, the segment was impacted by foreign exchange loss incurred on acquisition of slickline related assets.
The Integrated Corrosion Solution (ICS) segment recorded a pre-tax profit of RM1.0 million for FY2015, a 147.4% leap as compared to a pre-tax loss of RM2.0 million in the corresponding period as a result from the increased in Sponge-Jet blasting and other corrosion related services.
In line with Deleum’s dividend policy, the Company declared a second interim single tier dividend of 3.5 sen per ordinary share in announcing its financial results for FY2015, payable to shareholders on 25 March 2016. Combined with its first interim single tier dividend of 2.0 sen per ordinary share which was paid out on 25 September 2015, this will record a total dividend of 5.5 sen per ordinary share for FY2015 totalling RM22.0 million based on 400 million ordinary shares.
Challenges are expected to continue in current financial year and will remain so in the mid-term. Nonetheless, Deleum remains confident that our strong principal partnerships particularly in the P&M segment and the on-going contracts secured by Oilfield Services and ICS segments will not be materially affected. The Group will continue to monitor its cost structures closely, managing working capital and borrowings prudently and defer non-critical capital investments. Cash generation is expected to be satisfactory to support on-going operations and dividend payments.