3
MTQ CORPORATION LIMITED
production activity remain reasonably robust
in the Middle East but weaker in Asia and in the
North Sea.
For the year, lower revenues were recorded for all
the Divisions within the Group. Losses in Binder
pushed the Oilfield Service Division into an overall
operating loss whereas Engine Systems Division
remained marginally profitable at an operating
level. Corporate overheads and impairments
added to the overall loss recorded for the year.
At this point, the prospects of a quick recovery
look difficult. In the meantime, all our businesses
will focus on opportunities which remain in the
market, working closely with key customers with
the focus on maintenance and other service-
related opportunities.
Overall, the Group’s financial position remains
healthy which allows us to support existing
businesses through this downturn. We have
recently refinanced some committed bank
facilities, reduced the outstanding debt and
stretched out the debt maturity.We have no capital
market debt.We have a modest net gearing of 14%
and cash balances of S$25.0 million.That said, the
Board is not recommending any dividend for the
year. The negative outlook and the likelihood that
any recovery will take time, has compelled us to
take a prudent approach in conserving our cash
resources. This is not something we take lightly,
given our long track record of paying out steady
dividends. It is a decision I personally regret having
to do so and I want to thank all our shareholders
for their understanding.
I personally want to thank the support of all the
people who work for MTQ Group. We have had
to ask many of our staff to make pay sacrifices,
including our directors. I appreciate that they are
all doing their part to try and help the company
tide through this period.
It gives me little comfort to repeat comments
about ours being a cyclical business when we
are currently in a deep trough. Nonetheless, I am
confident that demand for energy will continue
to grow into the long term and once the supply
imbalances are corrected, our businesses will
regain their profitability.
CHAIRMAN’S
STATEMENT
Source : IHS Petrodata WorldRig Forecast: Short Term Trends May 2016
Source : IHS Petrodata WorldRig Forecast: Short Term Trends May 2016
