Serba Dinamik confident of flying colours

Najib Aroff
February 9, 2017 08:55 MYT

Serba Dinamik chairman Datuk Mohamed Nor Abu Bakar (2nd,right) Mohd Abdul Karim (centre) and director Abdul Kadier Sahib (2nd,left) at the launch of the company's prospectus, Dec 30, 2016. - Filepic

Serba Dinamik Holdings is confident of its ability to record flying colour financial results despite a slow down in the oil and gas (O&G) sector.

Its Chief Executive Officer Datuk Dr Mohd Abdul Karim Abdullah said this will be contributed significantly by its operation in six Middle East countries.

He said the operation and maintenance (O&M) services as well as the engineering, procurement, construction and commissioning (EPCC) will continue to get subscriptions from oil and gas companies.

These companies need to retain their assets at the best operating level possible, he added.

“Regardless how the oil and gas performance will look like, the maintenance segment will always be in need.

“O&G companies still need maintenance for their current assets to equip themselves when the oil prices increase.

“Saudi petroleum company will be listed and definitely Saudi as the biggest oil producer will ensure the stabilisation of the commodity prices,” said Mohd Abdul Karim.

He said this during a press conference on Wednesday after the company made its debut on the main board of Bursa Malaysia.

He was also optimistic that Serba Dinamik’s shares will continue to receive overwhelming subscriptions due to its strong fundamental.

“Our fundamental is strong. We have operations in Middle East which gave us 48 percent returns from total revenue.

“80 percent of our revenue is from O&M and the rest is from EPCC. And most of our contracts are long term, between 2 and 4 years, up to 2020.

“If the oil prices stabilised, we might expand into other countries in the region,” he said.

Serba Dinamik commenced its first operation in Qatar 15 years ago with O&M services, followed by United Arab Emirates (UAE), Oman, Bahrin and Kuwait.

Last year, it recorded a revenue of RM1.4 billion of which RM700 million are from Middle and Central Asia operations.

Apart from oil and gas sector, it has maintenance business for power plant in Kota Marudu in Sabah with EPCC value of RM218 million.

Mohd Abdul Karim said the company is also providing maintenance for oil refinery operations in Kerteh Terengganu.

“The asset in Kerteh now is about 25 years old. And these assets should be in average of around 15 years.

"So, definitely they need maintenance to ensure a smooth operation,” he added.

Meanwhile, he said the company also has two contracts in RAPID Pengerang project which contributed 3 percent to its revenue.

“We have one contract with Petronas in Pengerang with the possibility of extension. We also have a contract with Petrofac.

“We are also bidding for a few works in Pengerang,” he said while adding that the RAPID project provides huge opportunities for the company.

At the same time, Mohd Abdul Karim said the company is considering Merger and Acquisitions (M&A) to expand its capacity.

"Our plan is to use some of the proceeds from the listing for M&A, but it has to be a strategic asset that can add value to our expertise.

“We are almost finalising the M&A process for a company based in Europe and one in United States, which will be announced by the second quarter of this year.”

Earlier yesterday, Serba Dinamik recorded a premium of 3 sen to RM1.53 with more than 400 million shares exchanged hands.

#Datuk Dr Mohd Abdul Karim Abdullah #OIL AND GAS #petrofac #Petronas #Rapid Pengerang #Serba Dinamik Holdings