Gulf International Services Declares Financial Results for 2014

Staff writer

Gulf International Services (GIS), the largest services group in Qatar, has announced its financial results for the period ended Dec. 31, 2014 with revenue of QR 3.9 billion and net profit of QR 1.4 billion.
The profit represents a significant increase of QR 1.6 billion, or 69.7 percent, over the same period last year, the company said in a press release issued Monday.
The group’s share in revenue from Gulf Drilling International Company in 2014 was QR 1.8 billion, a significant increase over 2013 of QR 0.9 billion, or 100.0 percent. This performance was driven largely by the offshore sector, which contributed over 80 percent of total revenue, with the deployment of Al-Jassra and Leshat offshore rigs in the second and fourth quarters of 2013 respectively, Msheireb and Dukhan offshore rigs in the second and fourth quarters of 2014 respectively, and a new accommodation lift-boat, Rumailah, in the third quarter of 2014. The group also benefitted, in the third quarter of 2014, from favorable contract extensions for the onshore drilling rigs.
Aviation segmental revenue for the twelve months increased by a moderate QR 25.7 million, or 4.2 percent, to total QR 644.2 million.
The group’s insurance subsidiary registered gross insurance revenue for the financial year ended December 31, 2014 of QR 735.5 million, a QR 28.5 million, or 4.0 percent, improvement on the same period of 2013. The main contributor to this growth was the medical line of business which reported a year-on-year increase of 17.6 percent and now constitutes approximately 42 percent of Al Koot’s annual revenue. Results in the core energy line shrunk by a minimal 3.5 percent in line with a softening of global insurance rates.
Amwaj Catering Services Limited contributed QR 1.1 billion to group revenue, and now represents the second largest revenue segment. Compared to last year, the company grew by QR 118.6 million, or 12.1 percent, due to the expansion of core industrial catering, and camp management services. The group’s net profit for the year closed at QR 1.4 billion, a significant year-on-year increase of QR 0.7 billion, or 108.3 percent. This year-on-year improvement, the press release noted, was driven by the ambitious growth plans across all segments, especially in the drilling segment, and a gross one-off non-cash accounting adjustment for QR 0.3 billion.

This accounting adjustment was necessary to effect the gain on bargain purchase following the acquisition by GIS of the 30 percent shareholding of Japan Drilling Company in GDI on May 1, 2014, and has no cash flow implications. The accounting adjustment also required a revaluation of the drilling rigs and related equipment of GDI.

The favorable year-on-year positive net profit variance in the drilling segment of QR 440.6 million, or 179.1 percent, was driven primarily by the additional profit attributable to the buy-out of the interest held by its overseas drilling partner, the commencement of Al-Jassra, Leshat, Msheireb, Dukhan and Rumailah operations, and to higher daily rates received for the extension of four onshore rig contracts in the third quarter of 2014.

Aviation segment earnings for the year ended December 31, 2014 were impacted by operating cost increases, as the subsidiary registered a modest QR 6.8 million reduction in year-on-year net profit to close at QR 231.1 million.

Profit in the insurance segment for the financial year reached QR 162.4 million, a moderate increase of QR 8.4 million, or 5.5 percent, as strong medical revenue growth and gains on the company’s investment portfolio were partially offset by increased major insurance claims.

Net profit in the catering segment for 2014 was QR 118.9 million, up by QR 56.4 million, or 90.2 percent, as the subsidiary benefitted from its business expansion strategy, improved margins due to reduced operating costs and the provision of shut-down related services in the plants of clients.

The board of directors proposed in their meeting held on Jan. 7 a total annual dividend distribution for the year ended December 31, 2014 of QR 1.0 billion, equivalent to a payout of QR 5.50 per share, and representing 72.5 percent of the group’s net profit.

Source : Qatar News Agency