57 Performance Review a company that has demonstrated excellent operational and financial performance beyond the norm, while the latter honours maritime companies which have made a meaningful and positive difference in both safety and environmental performance. We are privileged to have been considered as a candidate for these prestigious awards. STEADFAST FINANCIAL PERFORMANCE As we put in place the measures to drive robust operational performance amidst the year’s challenging operating environment, this was reflected in our steadfast financial performance for the year in review. For the financial year ended 31 December 2016, the MISC Group posted revenue of RM9,597.2 million, a 12.0% decline against the preceding year’s revenue of RM10,908.4 million. The lower revenue was primarily attributable to lower charter rates earned on new contracts in the LNG segment and lower revenue from construction contracts in the Marine & Heavy Engineering segment. The Group turned in an operating profit of RM2,228.8 million, which was 19.9% lower than 2015’s operating profit of RM2,782.6 million. Lower revenue and higher depreciation, arising from the change in the estimated useful life of vessels in the current year, were the main causes for the decrease in operating profit. We recorded profit before tax of RM2,814.0 million in 2016, a 9.6% increase over the preceding year’s profit before tax of RM2,566.9 million. The increase in profit was mainly due to the recognition of gains on acquisitions and the disposal of subsidiaries during the year under review. As at the year’s end, the Group’s total assets stood at RM56,151.3 million or 18.1% higher than the RM47,539.1 million as at the end of 2015. The increase in the Group total assets were mainly due to consolidation of GumusutKakap Semi-Floating Production System (L) Limited (GKL), following completion of the equity buyback in May 2016, and higher capital expenditure incurred during the year. Group total liabilities at the end of 2016 of RM16,820.3 million were 51.8% higher than the RM11,079.9 million posted at the end of 2015, mainly from the increase in borrowings, following completion of the equity buyback of GKL in May 2016. As a result of the increase in total borrowings during the year, the Group’s net debt-to-equity ratio increased to 0.15 times as at 31 December 2016 from 0.02 times as at 31 December 2015. The Group’s committed capital expenditure stood at RM4,346.1 million as at the end of 2016. Based on our healthy financial position, combined with existing funding facilities and planned funding plans, the Group should be able to fund our committed capital expenditure and planned growth plans. Given the relatively low net debt/ equity ratio, the Group will pursue the optimum capital structure for any capital project or investment.
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