KUALA LUMPUR (Feb 14): Dialog Group Bhd’s net profit in the second quarter ended Dec 31, 2016 (2QFY17) rose 17.1% to RM91.36 million from RM78.01 million a year ago, mainly due to higher contributions from the group’s joint ventures (JVs).

In its filing with Bursa Malaysia, Dialog said these JVs include the Pengerang Independent Terminals, which has fully leased out its storage capacity and secured better storage rates,

“The Group’s share of joint-venture results for the current quarter of RM25.1 million was 67% higher compared with RM15 million recorded in the corresponding quarter last year,” it said.

Revenue in 2QFY17 also climbed 34% to RM856.78 million from RM639.63 million.

“The Malaysian operations remained busy during the current financial quarter with engineering, construction and fabrication activities from various on-going projects such as the Pengerang Deepwater Terminal Phase 2, Jetty Topside works for Samsung in Pengerang and the construction of a plasticiser plant for UPC Chemicals in Kuantan,” the group said.

However, the higher revenue recorded from these activities was partially offset by the lower sales in specialist products and services, it added.

“This explained the slight increase in net profit after tax contribution from Malaysia operations for the current financial quarter against the same period last year,” Dialog said.

On the other hand, Dialog international operations remained challenging in 2QFY17, with the slower upstream activities resulting in lower sales of specialist products and services.

“This had resulted in a drop in net profit after tax contribution from International operations in the current financial quarter against the same quarter last year,” it said.

For the first half of FY17, Dialog posted net profit of RM172.69 million, up 25.1% from RM138.08 million a year earlier.

Revenue, meanwhile, increased by 28.4% from RM1.18 billion to RM1.51 billion.

Moving forward, Dialog — an integrated technical services provider to the upstream, midstream and downstream sectors in the gas and petrochemical industry — remains optimistic that its business model is well-structured and can withstand the current oil price volatility and currency movements.

“The Group's financial track record has proven that Dialog’s business is well risk managed and sustainable, and will also review its resources to ensure a more efficient and effective distribution, and to further improve the skills of its manpower,” it said.

At the same time, the Group will continue to look for new opportunities to enhance its recurring income streams.

It added that with the ongoing operations of Pengerang Deepwater Terminal Phase 1 and the current construction of Phase 2, the group is now working towards securing new potential partners for subsequent phases, which will include the development of more petroleum and petrochemical storage terminals.

“Further development of the Pengerang Deepwater Terminal will provide more opportunities for the Group’s engineering, construction, fabrication and plant maintenance services,” it said.

Dialog is also developing an industrial estate with a land area of approximately 170-acres (68.8 ha) that would support the development of further downstream petroleum and petrochemical industries in Pengerang.

In the upstream sector, the group is on the lookout for viable production assets, which may become available for possible acquisition.

“Barring any unforeseen circumstances, the Group is optimistic that it will continue to deliver a healthy performance for the financial year ending June 30, 2017,” Dialog said.

Dialog’s share price closed 0.7% higher at RM1.55, valuing the group at RM8.39 billion.