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MMHE back in the black in Q3

MMHE back in the black in Q3
Malaysia Marine and Heavy Engineering (MMHE) returned to the black with a MYR16.4m ($3.9m) profit in the third quarter, recovering from a MYR4.5m loss in the previous correponding period, despite lower revenue and the completion of several projects.

MMHE said in a stock market announcement that revenue fell 35% to MYR215.4m from MYR333.5m previously due to less business and the completion of some current projects.

Revenue at the heavy engineering slide almost half to MYR117.6m from MYR219.7m previously mainly due to a lower backlog following completion of offshore projects in the current financial year while ongoing onshore projects in the current quarter are nearing completion, MMHE said.

Despite the lower revenue revenue however segment losses narrowed to MYR1.8m from MYR21.6m in the previous corresponding quarter, mainly from finalisation of completed projects in the current quarter.

Marine segment revenue also slid by 14% to MYR97.7m from MYR113.8m previously due to lower value and number of vessels repaired. As a result, segment profitslide 15% to MYR17.0m from MYR19.9m previously.

Looking ahead MMHE noted that while crude oil prices have slightly improved after production cuts, "the oil and gas outlook remains uncertain with heightened geopolitical concerns".

In addition MMHE also pointed out that shale oil phenomenon will continue to keep oil prices subdued over a prolonged period.

MMHE is working on new orders and "replenishment of order book from marine segment and offshore services are progressing and remain a priority".

"While the group has successfully secured several offshore fabrication projects during the period, the majority of the contribution will only be realised in 2018 and beyond," MMHE concluded.