Bintulu Port’s 9MFY24 disappoints on higher costs, tax in 3QFY24

KUCHING (Nov 26): Bintulu Port Holdings Bhd’s (Bintulu Port) first nine months of financial year 2024 (9MFY24) has disappointed expectations due to higher-than-expected operating and tax expenses during its third quarter (3QFY24).

For 3QFY24, Bintulu Port’s revenue had grown 8 per cent year on year (y-o-y) and 3 per cent quarter on quarter (q-o-q) to RM202.8 million thanks to higher LNG demand on re-stocking activities before the winter season and higher cargo volumes from key customers at its Samalaju Industrial Port.

Despite this, its core net profit (CNP) plunged 20 per cent y-o-y and 31 per cent q-o-q on higher operating expenses and a higher effective tax rate at 30.9 per cent from 24.2 per cent due to certain expenses being ineligible for tax claims.

This caused the group’s 3QFY24 CNP margin to plunge to 12.8 per cent from 17.4 per cent in 3QFY23 and 19.2 per cent in 2QFY24.

Cumulatively, this caused the group’s 9MFY24 revenue to come in at RM608.8 million which translates to a 10 per cent y-o-y increase and a CNP of rm108.5 million which grew at a wider 38 per cent y-o-y growth.

According to the research arm of Kenanga Investment Bank Bhd (Kenanga Research), the cumulative revenue was driven by growth in better performance in both Bintulu and Samalaju ports while a lower finance cost and reduced effective tax rate under a n interim lease arrangement for Bintulu Port helped improved its overall CNP margin from 14.2 per cent a year ago to 17.8 per cent.

Despite the robust cumulative growth, the results were slightly below expectations as it only met 70 per cent of consensus full-year estimates.

To account for the higher-than-expected operating and tax expenses, Kenanga Research has opted to lower their FY24 and Fy25 forward (F) net profit by 7 and 9 per cent to RM145 million and RM149.2 million, respectively.

Looking ahead, AmInvestment Bank Bhd (AmInvestment Bank) expected LNG throughput to remain stable in 2025 as demand will be supported by the supply of feed gas from the commissioning of Jerun and Kasawari gas fields.

“Petronas has lifted the force majeure on gas supplies to MLNG Dua with a capacity 9.6mtpa effective Nov 1. Recall, gas supplies from MLNG Dua were previously impacted due to leakage in the Sabah-Sarawak Gas Pipeline (SSGP) back in Sept 2022,” they added.

Sharing a similar view, Kenanga Research added that inbound and outbound cargo volumes at Samalaju Port from Bintulu Port’s key customers, Press Metal and OMG Ltd has also been observed to seen increases and are expected to sustain into the coming year.

“We believe its key customers have an edge over their peers in the international market as their products have low-carbon footprint given their hydro power input,” they reasoned.

They added that the ongoing sanctions on Russian aluminium will also cause western countries to continue looking for alternative sources of aluminium supply which bodes well for Bintulu Pport.

On a separate note, Bintulu Port is expected to commence handling of marine services for Sarawak Petchem’s methanol division from Dec 2024 onwards, while the setup of a new Bintulu Port Authority Sarawak (BPAS) that will be under purview of the Sarawak government is on track to be completed by year end.

“Currently, the Bintulu Port (Dissolution) Bill 2024 has been passed by both House of Representatives and House of Senate before notification in Gazette. At the same time, the new Port Operation Agreement is being drafted,” Kenanga Research shared.

The operations of Bintulu Port are not expected to see disruption during the process of Sarawak Government’s port authority takeover from the Federal Government.

-Agency

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