Thoresen Thai Agencies Public Company Limited ("TTA" or the "Company"), announced its results for the three months ended 30 September 2015 ("Q3/15"), highlighting an earnings of THB382.7 million. This represented a 183% quarter-over-quarter ("q-o-q") increase from THB135.4 million in Q2/15 and a 17% year-on-year ("y-o-y") increase from THB328.3 million in Q3/14.
According to TTA's reported financial results for Q3/15, the Company's total revenue stood at THB5.7921 billion, a decline of 2% y-o-y and 3% q-o-q respectively. It also reported a gross margin of 23%, consistent with Q3/14's gross margin, representing a 9% q-o-q gross profit increase.
Mr Chalermchai Mahagitsiri, TTA's President and Chief Executive Officer, referring to TTA's third-quarter results, said, "Despite a slight decline in revenue, TTA has managed to record an impressive earnings growth rate of 183% q-o-q, which was contributed by i) the exceptional performance of Mermaid Maritime as a result of the company's strategic focus on servicing the production phase of the E&P value chain and shallow water oilfield, which led to an increase in the utilisation rate of subsea engineering vehicles to 80%; ii) the recovery of the Baltic Dry Index during the quarter, which resulted in higher freight rates; and iii) the gain from foreign exchange rate. The rise in earnings this quarter also reflected greater efficiency in cost management."
"While PMTA remained profitable overall it reported lower earnings this quarter due to delayed domestic fertiliser sales as a result of prolonged droughts and contracted fertiliser exports to Africa. Sino Grandness Food Industry, which is engaged in food and beverage business in China, maintained its profitability level, recording THB43.9 million equity income to TTA. Unique Mining Services ("UMS") incurred additional losses due to low sales volume", he added.
Key Strategic Business Unit
Thoresen Shipping. In the dry bulk shipping business, freight revenue rose about 14% q-o-q. This was led by the BDI index's recovery during the quarter, the consequent 29% q-o-q jump in freight rates (Thoresen Shipping's TCE Rate) to USD8,047/day, and a foreign exchange gain from THB's depreciation against USD. Thoresen Shipping made a strong comeback, recording THB150.8 million in earnings.
Mermaid Maritime. Subsea engineering services continued its positive trend from the previous quarter, with the utilisation rate rising to 80% as result of Mermaid vessels' strong presence in the Middle East as well as high season activities. As for drilling, the utilisation rate of drilling rigs increased to 73%, mainly due to AOD's jack-up rig producing returns at the level achieved over the previous quarter. These were translated into Mermaid's excellent quarterly earnings of THB579.4 million (contribution to TTA was THB338 million), which represented a 31% y-o-y and a 15% q-o-q growth.
PM Thoresen Asia. PMTA retained its overall profitability, although its revenue and earnings were lower compared to the previous year. As a result of the El Nino effects that brought about a prolonged drought in South-East Asia, PMTA's fertiliser sales saw a decline in the Vietnamese market. PMTA's export figures also declined as opportunities to export fertiliser to certain African countries were limited.
Unique Mining Services. UMS' suffered a larger loss compared to the previous quarter as the company was handling the issues involving its credit crunch. It hence led to difficulties in coal importation and sales. However, with the recent financial injection by TTA, UMS' performance is expected to show gradual improvement.
Sino Grandness. Sino Grandness contributed a profit of THB43.9 million to TTA, a slight reduction from the previous quarter due to increased advertising expense to expand the sales network, and as it focused more on building and increasing its own-branded product sales in domestic markets where it enjoys higher margins. Sino Grandness' performance is expected to improve, and the company is expected to continue to make positive profit contribution to TTA in the next quarter.
Mr Chalermchai Mahagitsiri added, "The Q3/15 earnings growth signifies TTA's great comeback. We are also exploring various unlimited business opportunities, and some projects may conclude by year end or early next year. We will continue to strive to maintain our strengths in core businesses, and enhance our position to stand any future uncertainties."