Malaysia: MHB profit plunges

Malaysia Marine and Heavy Engineering (MHB) posted a profit of RM44.4 (US$10.52 million) in 2015, almost three times lower as compared to the year before.

The drop in net profit was due to lower contribution from the company’s offshore segment and the impact from “a provision for impairment on the goodwill and assets of the Group amounting to RM99.8 million,” MHB said in a statement on Wednesday.

“This is taken in view of the continued depressed outlook for the oil and gas industry with the drop in crude oil prices,” the statement said.

Revenue of RM2.46 billion was also lower as compared to RM2.7 billion in 2014.

MHB’s offshore business recorded revenue of RM2 billion for the 12-months period against RM2.44 billion in the preceding year due to lower number of projects secured than anticipated.

The marine business unit registered higher revenue of RM466.7 million compared to RM320.8 million in the previous year on the back of higher value of work per project achieved, MHB said in the statement.

Among its completions are four FSO conversions and major RLE work of three LNG carriers, MHB added.

Managing Director and CEO, Dato’ Haji Abu Fitri Abdul Jalil said, “The tough operating environment in the upstream segment is projected to persist well into 2017 as national and international oil companies continue to reduce their spending on capital and operating expenditure. This will continue to impact offshore business.”

“Our marine business is projected to remain vibrant as the firm tanker charter rates in the marine segment will somewhat mitigate the slowdown of the offshore unit,” the CEO added.

1 Malaysian ringgit = 0.23699 U.S. dollars

LNG World News Staff