Qatar- GIS reports revenue of QR705m for Q1

(MENAFN - The Peninsula) The Peninsula Gulf International Services (GIS or the Group), yesterday reported a net loss of QR5.5m for three-month period ended March 31, 2021. Group's revenue for the first quarter amounted to QR705m, a reduction of 15 percent compared to Q1-20. Revenue growth from insurance segment was entirely offset by reduction in revenue from all the other segments. During Q1-21, oil and gas industry showed early signs of recovery, amid cautious global optimism arising from the vaccine rollout and ease of lockdown restrictions in major markets. However, the pace of economic recovery depends on the pandemic's impact to filter through with subdued external demand for energy and the related services for the remainder of the year, before the wider spread of vaccine benefits spur greater global economic activity. Nevertheless, the positive signs of economic recovery were not immediately felt within the Group's operating segments. The Group reported an EBITDA of QR112m for the period ended 31 March 2021, while the Group posted a net loss of QR5.5m for the three-month period ended 31 March 2021. Topline performance of the Group continued to be impacted by the external challenges affecting the Group since the pandemic. The drilling segment remained under pressure with ongoing suspension of rigs, coupled with lower rig dayrates, which were implemented during mid of 2020. Flying hours within the aviation segment witnessed a reduction compared to Q1-20, mainly due to actual recovery in oil and gas services being slower than expected, affecting the overall flight demand from clients. As for the catering segment, restrictions and lockdowns imposed by the Government and clients impacted revenues and financial performance. On the other hand, insurance segment continued its positive trajectory, while building on premiums on the back of segment's market expansion strategies and successful contract renewals coupled with favorable pricing terms. Finance cost for Q1-21 decreased by 41 percent, to reach QR30m, compared to QR51m in Q1-20, on the back of the drop in interest rates. Similarly, general and administrative expenses declined by 16 percent on account of continued optimization drive. Moreover, the performance of Group's investment portfolio was positively impacted due to recovery in capital markets, and a recovery amounting to QR55m was noted on account of unrealized gains on revaluation of investment securities, when comparing current period's investment portfolio performance with Q1-20. Revenue for Q1-21 represented a moderate decrease of 4 percent, compared to Q4-20, mainly on account of negative growth in revenue from aviation segment, due to reduction in revenue from Turkish subsidiary RSA, while MRO revenue remained lower due to completion of a project carried out during the previous quarter. Net loss for Q1-21 reduced by 98 percent compared to Q4-20. The significant reduction in net loss was mainly due to the one-off, non-cash impairment provision amounting to QR308m recorded during Q4-20 in relation to certain drilling and aviation assets The Group's total assets increased by 5 percent during the year, to reach QR10.4bn as at 31 March 2021, compared to last year. On the liquidity front, the closing cash, including short-term investments, stood at QR753m, up by 8 percent as compared to 31 December 2020. The total debt at Group level stood at QR4.4bn as at 31 March 2021. The current levels of debt continue to impact the Group's net earnings, as finance cost is one of the key cost ingredients and especially limits the drilling segment's profitability, considering major amount of Group's debt relates to the drilling segment. Continued efforts are underway to achieve the targeted direction in relation the funding strategy, which could lead to an optimum funding levels with an efficient and effective interest cover for the Group. The Drilling segment reported a revenue of QR198m for the threemonth period ended 31 March 2021, down by 32 percent compared to last year. The reduction in revenue was primarily due to the ongoing rig suspension within the onshore fleet. In addition, the rig day-rates, with effect from July 2020, has been repriced with reduced rates and currently remained at the same levels for Q1-21. Aviation segment reported a total revenue of QR165m for the three-month period ended 31 March 2021, down by 11 percent compared to Q1-20. The negative growth in revenue was mainly on the back of ongoing impact of COVID-19 restrictions, affecting the flight demand, both domestically and internationally, as the actual recovery in terms of flying hours has been slower than expected during Q1-21. Revenue within the insurance segment for the three-month period ended 31 March 2021, increased by 11 percent, as compared to Q1-20, to reach QR256m. The growth in revenue was mainly due to higher premiums from the general insurance segment. The segment net profit for Q1-21, increased by 134 percent compared to Q1-20, to reach QR15m. The strong growth in bottom line profitability was mainly supported by significant improvement in premiums, in addition to strong recovery within the investment portfolio on the back of recovery in capital markets. Unrealized gain on revaluation of investment portfolio contributed QR55m towards the segment's bottom line earnings for Q1-21 in comparison to Q1-20. Catering segment reported a revenue of QR86m, with a decline of 31 percent compared to Q1-20. This was mainly as a result of lowered number of meals served across majority of catering locations, due to COVID-19 restrictions and lockdowns imposed, in addition to demobilization of some contracts within both the manpower and catering contracts during Q4-20. The Board of Directors in its meeting held on April 29, 2021, unanimously approved the appointment of Saad Rashid Al Muhannadi as the Vice Chairman of the Board of Directors with immediate effect.MENAFN30042021000063011010ID1102005577