Nam Cheong Limited: Analyzing Net Profit Growth of 5.11% for FY2024

Business Description

Nam Cheong Limited is a company incorporated in Bermuda, operating in the offshore oil and gas industry. The company provides a range of offshore support vessels, including anchor handling tug supply vessels, platform supply vessels, and accommodation work barges. The company’s operations are primarily focused in Malaysia, with some presence in other Southeast Asian countries.

Financial Statement Analysis

Income Statement

The company’s revenue for the financial year ended 31 December 2024 (FY2024) was RM684.71 million, a decrease of 0.68% from the unaudited results. The decrease was mainly due to the elimination of intercompany transactions. The company’s gross profit for FY2024 was RM363.29 million, a decrease of 0.78% from the unaudited results.
The company’s net profit for FY2024 was RM800.20 million, a decrease of 0.63% from the unaudited results. The decrease was mainly due to adjustments for over-recognition of foreign exchange gains, impairment losses on trade and other receivables, and over-provision of current year tax expenses.

Balance Sheet

The company’s total assets as of 31 December 2024 were RM1.28 billion, an increase of 0.11% from the unaudited results. This was mainly due to the under-recognition of property, plant, and equipment.
The company’s total equity as of 31 December 2024 was RM574.56 million, an increase of 0.69% from the unaudited results. This was mainly due to the reversal of impairment of investment in subsidiaries and reclassification of amounts due from subsidiaries.

Cash Flow Statement

The company’s cash flow statement was not provided in the report.

Key Findings

The key findings from the financial statement analysis are: – The company’s revenue and net profit declined slightly from the unaudited results, but the company remains profitable with a net profit margin of 116.9%. – The company’s balance sheet is healthy, with a strong asset base and a comfortable level of equity. – The company did not provide information on its cash flow statement, which is an important indicator of the company’s financial health and ability to generate cash.

Recommendation

Based on the financial information provided in the report, investors currently holding the stock of Nam Cheong Limited may consider holding on to their investment. The company’s profitability and financial position remain strong, despite the slight decline in revenue and net profit.
For investors not currently holding the stock, the company’s financial performance and position may be worth considering as a potential investment opportunity. However, the lack of information on the company’s cash flow statement is a concern and should be further investigated before making an investment decision.
It is important to note that this recommendation is based solely on the information provided in the report and may not reflect the current market conditions or the company’s future performance. Investors should conduct their own due diligence and consult with a financial advisor before making any investment decisions.

Disclaimer

This report is for informational purposes only and does not constitute investment advice. The information provided is based on the financial report provided and may not reflect the current market conditions or the company’s future performance. Investors should conduct their own due diligence and consult with a financial advisor before making any investment decisions.

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