SINGAPORE (Feb 13): New Silkroutes Group (NSG), previously known as Digiland International, posted a decline in its losses to US$0.3 million ($0.4 million) for the second quarter ended Dec 31, a 37% improvement from its losses of US$0.5 million in 2Q16.
This was mainly due to its wholly-owned oil and gas (O&G) unit headquartered in Singapore, International Energy Group (IEG), whose revenue rose to US$123.7 million from just US$5.8 million a year ago due to the company’s higher engagement with more counterparties, boosted trading volumes, and more profitable trades in the quarter.
IEG, which intends to own and manage oil storage facilities as part of its longer-term growth strategy, posted a net profit of US$0.7 million in 2Q17 – a reversal from its loss of US$0.1 million in the corresponding quarter the year before.
As a result, NSG’s group revenue for the quarter grew to US$123.8 million from US$6.3 million a year ago, more than 20 times higher as compared to group revenue of US$69.3 million in the previous quarter.
Purchases, however, more than offset the higher revenue by increasing to US$126.7 million in the quarter from US$6.2 million a year ago mainly in accordance to increased oil sales by IEG.
Notably, NSG registered US$33.6 million in cash flow from operating activities, as compared to cash flow used in operating activities of US$0.8 million, which the group says is substantially due to increased oil trading activities, and careful cash management.
As at Dec 31, the group’s cash and cash equivalents increased to US$42.2 million from US$3.6 million as at Jun 30.
As part of efforts to diversify its income stream, NSG said earlier this month it would acquire an 80% stake in CG Capital Markets Holdings LLC, a broker-dealer and investment bank based in New York.
The group in December last year completed its acquisition of a 51% stake in Singapore’s Healthsciences International (HSI).
Shares of NSG closed 1.1% higher at 90 cents on Monday.
