Gulf International Services (GIS) - a holding entity of Gulf Drilling International, Gulf Helicopters, Al Koot and Amwaj - has reported a net profit of QR41mn during the first nine months (9M) of 2021, translating as earnings-per-share of QR0.022.
The group’s revenue was however, down 1% year-on-year to QR2.2bn. The revenue growth from insurance and aviation was offset by revenue decline in both drilling and catering segments.
"The decline in group revenues led to a decline in net earnings. Moreover, direct costs increased by 3%, negatively affecting the group’s profitability, and was mainly due to increase in activity within drilling and aviation segments coupled with increased claims within insurance segment, partially offset by direct cost reduction noted in catering segment," a GIS spokesman said.
GIS' finance cost fell 27% to QR96mn, against a backdrop of lower interest rates. Similarly, general and administrative expenses were down 1% on continued optimisation programmes.
Total assets were valued at QR10.2bn at the end of September 2021. Cash and short term investments stood at QR763mn. Total debt at group level was QR4.4bn. The current levels of debt continue to impact the group’s net earnings.
The drilling segment saw 1% fall in revenue to QR716mn, mainly impacted by rigs’ suspension within onshore fleet carried forward since last year until the first half of 2021, where two of the suspended rigs had commenced operations during Q3 of 2021.
In addition, rig day-rates remained depressed during first half of the year and impacted revenue growth on a year-on-year basis. However, the rig-day rates applicable to the offshore fleet improved during the third quarter of 2021, as the newly day-rates applicable to offshore fleet took effect from July this year.
Moreover, deployment of three additional rigs as part of Gulfdrill joint venture's fleet during the second quarter of 2021, has also added value to segment’s revenue recovery.
The segment reported a net loss of QR159mn against a net loss of QR120mn during 9M-2020, primarily attributed to lower revenue.
However, this was partially offset by a decline of QR31mn in segment’s finance cost compared to 9M-2020, on account of lower interest rates.
The aviation segment reported an 8% yearly increase in revenue to QR528mn during 9M-2021, due to higher flying hours within both domestic and global operations, coupled with revenue growth across all the businesses within the segment.
The segment’s net profit reached QR175mn, representing a year-on-year increase of 13%, mainly on account of revenue growth.
The revenue within the insurance segment was up 1% year-on-year to QR745mn as the growth in premiums from general insurance line of business was offset by decline in premiums from medical line of business.
The segmental net earnings increased by 44% year-on-year to QR50mn during 9M-2021, mainly on strong recovery within investment portfolio on the back of recovery in capital markets.
Besides, the unrealised gain on revaluation of investment portfolio contributed QR38mn positively towards segment’s net earnings during 9M-2021.
The catering segment saw a 19% decline in revenue to QR258mn, mainly due to ongoing Covid-19 related restrictions, which resulted in lower number of meals being served across majority of catering locations.
The segment reported a net loss of QR19mn during 9M-2021 against a net loss of QR4mn, mainly on lowered margins and declining revenues.
"The decline in group revenues led to a decline in net earnings. Moreover, direct costs increased by 3%, negatively affecting the group’s profitability, and was mainly due to increase in activity within drilling and aviation segments coupled with increased claims within insurance segment, partially offset by direct cost reduction noted in catering segment," a GIS spokesman said.
GIS' finance cost fell 27% to QR96mn, against a backdrop of lower interest rates. Similarly, general and administrative expenses were down 1% on continued optimisation programmes.
Total assets were valued at QR10.2bn at the end of September 2021. Cash and short term investments stood at QR763mn. Total debt at group level was QR4.4bn. The current levels of debt continue to impact the group’s net earnings.
The drilling segment saw 1% fall in revenue to QR716mn, mainly impacted by rigs’ suspension within onshore fleet carried forward since last year until the first half of 2021, where two of the suspended rigs had commenced operations during Q3 of 2021.
In addition, rig day-rates remained depressed during first half of the year and impacted revenue growth on a year-on-year basis. However, the rig-day rates applicable to the offshore fleet improved during the third quarter of 2021, as the newly day-rates applicable to offshore fleet took effect from July this year.
Moreover, deployment of three additional rigs as part of Gulfdrill joint venture's fleet during the second quarter of 2021, has also added value to segment’s revenue recovery.
The segment reported a net loss of QR159mn against a net loss of QR120mn during 9M-2020, primarily attributed to lower revenue.
However, this was partially offset by a decline of QR31mn in segment’s finance cost compared to 9M-2020, on account of lower interest rates.
The aviation segment reported an 8% yearly increase in revenue to QR528mn during 9M-2021, due to higher flying hours within both domestic and global operations, coupled with revenue growth across all the businesses within the segment.
The segment’s net profit reached QR175mn, representing a year-on-year increase of 13%, mainly on account of revenue growth.
The revenue within the insurance segment was up 1% year-on-year to QR745mn as the growth in premiums from general insurance line of business was offset by decline in premiums from medical line of business.
The segmental net earnings increased by 44% year-on-year to QR50mn during 9M-2021, mainly on strong recovery within investment portfolio on the back of recovery in capital markets.
Besides, the unrealised gain on revaluation of investment portfolio contributed QR38mn positively towards segment’s net earnings during 9M-2021.
The catering segment saw a 19% decline in revenue to QR258mn, mainly due to ongoing Covid-19 related restrictions, which resulted in lower number of meals being served across majority of catering locations.
The segment reported a net loss of QR19mn during 9M-2021 against a net loss of QR4mn, mainly on lowered margins and declining revenues.