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KUALA LUMPUR: CIMB Equities Investigate expects Dialog Team Bhd to produce robust earnings advancement from up coming yr onwards, as quite a few of its key jobs reach their commissioning phase.

It reported on Wednesday that most just lately, the LNG regasification plant at Pengerang SPV3 officially commenced commercial functions on Nov 1, and took shipping and delivery of its first professional cargo on Nov 10. 

“Construction development on Pengerang SPV2 is a bit ahead of timetable, and should start earning some revenue from midCY18F, in advance of its official commissioning slated in early-CY19F,” it said.

To recap, CIMB Investigation mentioned on Aug 18, Vopak kicked-off the enlargement of Pengerang SPV1’s potential of 1.3 million cubic metres (cbm) by a different 430,000 cbm, to be commissioned progressively from 1QCY19F. It expects yet another 570,000 cbm to be extra by FY20F. 

On Nov 10, Dialog signed a 30-yr land lease to acquire an supplemental 300,000 cbm at Langsat 3, growing from the present Langsat 1 and 2 potential of 647,000 cbm. 

“We hope Langsat 3 to be ready by FY20F. Dialog is confident it can take company from Singapore to fill up the new capacity,” it mentioned.

CIMB Investigation claimed Dialog noted that it is “securing new likely companions for Period 3… which will be created on 800 acres comprising reclaimable land and the buffer zone”. 

“A upcoming announcement to this result will most likely to have a effective beneficial influence on its share value, in our look at. Draw back dangers involve delays to foreseeable future developments,” it explained.

Commenting on the 1QFY18 main net gain of RM88.5mil, it reported it rose 42% on-year, driven by significantly higher engineering, procurement, design and commissioning (EPCC) profits of RM410mil vs. only RM73mil in 1QFY17. 

“We think this was similar to the timing of revenue recognition for the ongoing Pengerang SPV2 and SPV3 projects. 

“Also, Dialog most likely booked far more plant routine maintenance profits on-calendar year, partly offset by decreased upstream earnings. Sales of specialty merchandise was weaker in Malaysia, but more powerful abroad. 

“The tank terminals small business, which was represented in 1QFY18 by the 30%-owned Kertih terminal, 44%-owned Langsat terminals, and 46%-owned Pengerang SPV1 terminal, was secure, with Dialog’s share of JV profits amounting to RM27mil in 1QFY18, up a little from RM25mil in 1QFY17, but down a bit from RM28mil in 4QFY17. 

“These revenue fluctuations are slight, in our check out, and might be because of to tiny changes in utilisation, the volume of throughput, the degree of ancillary companies carried out, or trade charges,” it said.
 
CIMB Investigation claimed in late-September, Dialog acquired MISC’s 36% successful stake in the Langsat terminals, for RM137mil, and also took more than MISC’s shareholder loans of RM56mil. 

This elevated Dialog’s stake in the Langsat terminals from 44% to 80%. That’s why, the stability sheet of the Langsat terminals were being consolidated into its Sept 30 2017 accounts, and their earnings will be consolidated from 2QFY18F onwards. 

“Dialog also booked RM65.6mil in fair value acquire from the physical exercise, which we have labeled as an extraordinary item,” it stated.

 





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