Dayang’s FY25 earnings fall 36 pct on lower TMS activity

KUCHING (Feb 12): Dayang Enterprise Holdings Bhd’s (Dayang) core earnings for financial year 2025 (FY25) fell 36 per cent year-on-year (YoY) to RM193 million amid weaker revenue and reduced offshore activity.

Despite the decline, the results came in ahead of analysts’ expectations, supported by stronger margins, lower interest expenses and higher interest income.

Phillip Capital in a note on Thursday said that FY25 revenue dropped 36 per cent YoY to RM938 million, mainly due to a slowdown in topside maintenance services (TMS) activities following fewer work orders.

The decline was also attributed to lower vessel utilisation arising from project commencement delays, scheduled dry-docking and early off-hire of certain accommodation work boats, as well as softer third-party vessel chartering.

For the fourth quarter of FY25 (4QFY25), Dayang posted a core profit after tax, amortisation and minority interest (PATAMI) of RM56.4 million, up 24.5 per cent YoY.

The improvement was largely driven by a realised foreign exchange gain of RM20.2 million during the quarter.

Public Investment Bank Bhd (PublicInvest Research) however noted that gross profit for FY25 declined 33.2 per cent YoY to RM153.5 million which is in line with lower offshore TMS work orders.

In 4QFY25, vessel utilisation improved to 52 per cent from 48 per cent a year earlier. However, Marine Charter segment revenue fell 22.2 per cent YoY due to the absence of third-party vessel chartering, as most vessels were redeployed to regions offering stronger daily charter rate (DCR) opportunities.

Revenue was also subsequently affected by the underutilisation of accommodation work barges (AWB), which typically command higher DCRs compared to anchor handling tug supply (AHTS) vessels.

For the full year, offshore TMS revenue declined 42.1 per cent YoY, reflecting lower activity levels and the transition into a new maintenance contract cycle that began in November 2024.

PublicInvest Research said the trend was consistent with the 2025 Petronas Activity Outlook which indicated significantly lower Maintenance, Construction and Modification (MCM) and Hook-Up and Commissioning (HUC) work scopes.

Looking ahead, the house said the latest Petronas Activity Outlook 2026–2028 has revised down man-hour requirements for MCM and HUC activities, as well as offshore support vessel (OSV) demand, compared with the previous PAO 2025–2027.

“This underscores a more cautious operating environment as Petronas preserves cash amid a softer oil price backdrop.

“The outlook is further clouded by domestic regulatory uncertainties following PETRONAS’ move to seek clarification from the apex court on the legal framework governing its operations in Sarawak,” it said.

Nevertheless, Kenanga Investment Bank Bhd (Kenanga Research) said Dayang maintains a healthy order book of RM4.8 billion. It said the group’s earnings are expected to gradually recover from FY25 as clients typically ramp up work orders about two years after umbrella contract awards, most of which were secured in the fourth quarter of 2024.

As such, FY26 is expected to see modest improvement with stronger recovery potential anticipated in FY27.