Malaysia's Straits Inter Logistics Reports 14.6% Gain in Q1 Bunkering Profit

The company is based in Kuala Lumpur. File Image / Pixabay

Malaysia's Straits Inter Logistics reported a 14.6% gain in pre-tax profit from its oil trading and bunkering segment in the first quarter from a year earlier.

The segment posted pre-tax profit of 3.849 million ringgit ($933,000) in the first quarter, up from 3.358 million ringgit in the same period of 2020. The company's total pre-tax profit surged by 65.5% to 2.935 million ringgit.

The company's improving fortunes were "substantially attributable to oil trading and bunkering services segment due to the recovery of the oil price compared to the corresponding quarter of the previous year," the firm said in a first-quarter results statement published on Monday.

But the company warned of likely further impacts from the COVID-19 pandemic on its business.

"The COVID-19 pandemic continue to pose challenges to global business environment since its outbreak in March 2020," the company said.

"The economy outlook remains highly uncertain with the continuous mutation of the COVID-19 virus and more movement control are expected to be reimposed to break the chain of infection."

OW Bunker Arbitration

The company is facing a legal challenge from ING Bank and OW Bunker Far East (Singapore) Pte Ltd, it said.

Tumpuan Megah Development (TMD), in which Straits Inter Logistics holds a 70% stake, allegedly bought from OW about 424 mt of gasoil at Pasir Gudang and another 795 mt at Kuantan in October 2014. ING and OW are seeking to recover $937,353 from TMD over this trade.

"TMD is taking steps to strenuously resist this attempt to enforce an invalid arbitration award issued without jurisdiction," the company said.

The stems were carried out prior to Straits Inter Logistics acquiring its stake in TMD, and the previous owner indemnified it against TMD's liabilities in future arbitration, the company added.