KUALA LUMPUR, Malaysia--Sapura Energy Bhd. (5218.KU), Malaysia's largest oil-and-gas services firm by market value, said Wednesday its net profit for its fiscal second quarter ended July dropped 74.2% compared with a year ago partly due to lower revenue from its drilling business.
The weaker on-year performance was also due to the financial impact of the cessation of a upstream oil exploration contract called Berantai Risk Service Contract in the second quarter in the last fiscal year, it said.
Net profit for the May-July period declined to MYR28.93 million ($6.88 million) from MYR112.27 million the same quarter a year ago, according to a local stock-exchange filing.
Revenue declined 1.1% to MYR1.66 billion during the quarter from MYR1.68 billion a year ago, mainly due to the lower revenue from its drilling and exploration as well as production business segments, according to the filing.
Moving forward, Sapura Energy said industry conditions continue to be challenging in the current financial year ending January 2018.
"Whilst oil prices have stabilized, the group remains cautious on the outlook of recovery in the industry's capital spending in the near term," it said in notes accompanying its financial statements.
Sapura Energy said its board is however confident that the company's strategic and operational plans that have been put in place will mitigate the impact and improve its position in the longer term.
Shares of Sapura Energy were 0.6% higher at MYR1.72 at the midday break, before the earnings release. Shares of the company have climbed some 6.2% year-to-date.
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(END) Dow Jones Newswires
September 27, 2017 01:27 ET (05:27 GMT)