SINGAPORE (May 28): Gaylin Holdings, the specialist provider of products, services and solutions to the oil & gas (O&G) and maritime industries, saw 4Q losses widen to $44.4 million from a loss of $6.2 million a year ago due to higher provision for slow-moving and aged inventory.
The latest set of quarterly results brings the group to a full year loss of $51.6 million as compared to its FY17 loss of $11.4 million, in line with Gaylin’s management guidance announced earlier in March this year.
See: Gaylin sounds net loss warning for FY18
Revenue for the latest 4Q fell 28.1% to $15.5 million from $21.6 million in the previous year, as contributions from the rigging & lifting and ship chandling segments fell when compared to those of 4Q17.
Notably, a $35.5 million provision for slow-moving and aged inventory was recorded over 4Q18 compared to just $2.3 million in the same period a year ago.
Excluding this provision and non-recurring expenses, corresponding gross profit margin increased to 15.9% from 12.8%.
While Gaylin notes that low oil prices and the concomitant reduced activity by major customers continued to weigh on the group in FY18, it adds that the group has, over the past few months, announced significant financial and corporate actions to enhance its financial stability and strengthen operational competitiveness.
These include a $68 million equity investment from ShawKwei & Partners’ investment company PeakBayou Limited, and a debt restructuring program which the group recently completed to extend the maturity of its bank debt.
See: Gaylin completes US$100 mil investment and debt restructuring
Kyle Shaw, executive chairman of Gaylin as well as managing partner of ShawKwei & Partners, says he expects these developments to provide financial stability, improve market competitiveness, and strengthen Gaylin’s abilities in its major markets going forward.
Shares in Gaylin last traded at 9 cents.