Press Releases
Dialog: Pengerang project to kick off early next year
25 Nov, 2010
Source: The Edge Financial Daily
PETALING JAYA: Dialog Group Bhd is set to embark on phase one of the RM5 billion independent deepwater petroleum terminal in Pengerang, Johor, early next year and expects the project to begin contributing to earnings in 1QFY12 ending Sept 30, 2011.

Its executive chairman Ngau Boon Keat said Dialog was awaiting approval from the Department of Environment's environmental impact assessment (EIA) as well as the green light from relevant federal government agencies before commencing, noting that the Johor government had approved 500 acres (200ha) of land for the project site.

He said Dialog, an integrated technical services specialist for the oil & gas (O&G) industry, had spent RM7 million and would put in additional RM16 million for "detailed study" of the Pengerang project which would be completed in the next two to three months.

"We are telling shareholders that we are still conducting detailed study to make sure that everything is in order, and that the risks are well-contained, before investing into the RM5 billion job," Ngau told a press conference after Dialog's annual general meeting yesterday.

The Pengerang terminal is one of the two entry-point projects (EPPs) under the "Enhancing Downstream Growth" thrust that falls within the oil, gas and energy National Key Economic Area (NKEA).

Divided into three phases, the project is a public-private partnership between the Johor government, Dialog and Vopak Asia Pte Ltd. Dialog would be investing RM2.3 billion in the project of which 30% would come from equity and 70% from project financing. According to Ngau, phase one of the project would incur about RM1.5 billion investment and was targeted to be completed by end-2013, adding that the entire project would span over seven years.

"We can't talk about exactly how much we are going to earn... But you know it is a good prospect and it's going to be big," said Ngau when asked on the amount Dialog expected to gain from the Pengerang project.

He was also tight-lipped on Dialog's profit margins from the Pengerang project and as to whether the massive project would totally change the earnings of the group from FY20 onwards.

"We are optimistic the results (for FY11) would be positive. I can only used the word optimistic," said the executive chairman when commenting on its current financial year expectation.

Dialog's net profit for 1QFY11 rose 22.8% to RM33.09 million from RM26.93 million a year ago on the back of a lower revenue of RM263.8 million versus RM308.85 million.

The group posted earnings per share (EPS) of 1.69 sen in 1QFY11 while net assets per share stood at 25.87 sen as at Sept 30.

Dialog's share price yesterday added six sen to close at RM1.50 after hitting a 52-week high of RM1.51 with a turnover of 12.36 million units. The counter had risen 59.07% year-to-date. Ngau said Dialog would continue to grow its core business with recurring income particularly from specialists products and services as well as plant maintenance services. He said the group was expanding its scope to venture into the provision of upstream O&G expertise services initially for the domestic market.

He noted that the group had customers in more than 10 countries including Chile, Brazil and Bolivia and that almost half of its revenue came from the foreign markets. Dialog registered a net profit of RM124.65 million on a revenue of RM1.13 billion for FY10.

"We don't emphasise on order book. Dialog emphasises on bottom line. As such, we provide services with good margins," he pointed out. Currently, the group has net cash in hand of about RM190 million.

On the group's integrated offshore supply base in Jubail Commercial Port, Saudi Arabia, Ngau said the project, with an investment of RM100 million, would commence "anytime now" and was targeted to be completed by the third quarter of 2011.

PrintClose Top

© Copyright 2017 Dialog Group Berhad. All Rights Reserved. | Powered by Webz