MISC Berhad has reported a 24% rise in first-quarter net profit, largely on the back of higher operating profits of its tanker division.

The Malaysian tanker, LNG and offshore vessel owner and operator made MYR 759.9m ($161.4m) for the three months ended 31 March, up from MYR 612m a year earlier.

Revenue for the quarter was up 18% to MYR 3.64bn.

The shipowner attributed the increases in large part to higher earning days in the petroleum and product tanker segment.

Higher revenues from its marine & heavy engineering segment also helped push group operating profit up 6.8% to MYR 882m.

The result was partly offset by lower revenue in the offshore business segment as progress slowed on the conversion of a floating production, storage and offloading unit.

At the same time, cash flows from operating activities plunged 76.8% to MYR 696.3m, as higher payments were made to creditors.

Rosy prospects

The shipowner is optimistic about the prospects for its product tanker and LNG divisions.

Product tankers remained firm amid an increase in tonne-mile demand driven by growing long-haul Atlantic exports, notably from the US, Brazil and Guyana.

“The current year outlook remains positive with favourable tanker supply/demand fundamentals,” it said.

“The petroleum & product shipping segment will continue to identify opportunities, particularly in dual-fuel assets and focus on building long-term secured income to generate business growth.”

Rates in the LNG segment had softened this year as a result of seasonally weak demand and inventory build-up in Europe and north-east Asia.

However, the prospects “remain positive as spot rates are anticipated to gradually improve in line with seasonal demand”, the company said.

Operating income for the gas assets & solutions segment is expected to remain stable, supported by its portfolio of long-term charters.