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MMHE turns to $30m loss in 2016

Offshore engineering focussed group Malaysia Marine and Heavy Engineering Holdings (MMHE) turned in a MYR134.3m ($30.3m) full year loss for 2016, hit by lower contributions from the key Heavy Engineering segment, forex issues and higher charges on assets in the current year.

Vincent Wee, Hong Kong and South East Asia Correspondent

February 7, 2017

1 Min Read
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MMHE said in a stock market announcement that  revenue fell 51.5% to MYR1.19bn from MYR2.46bn previously as the heavy engineering segment saw revenue fall by 63% from MYR1.99bn to MYR746.7m as the orderbook depleted and new orders dwindled.

For the fourth quarter, the loss widened from MYR27.1m to MYR119.7m and the revenue fell by more than half from MYR721.1m to MYR303.6m

Fourth quarter revenue from the heavy engineering segment plunged even more dramatically, falling 72% to MYR172.8m from MYR615.1m as the order backlog and new orders situation worsened.

The marine segment’s revenue and operating profit, however, was higher from a year ago, mainly due to higher value of vessels repaired from LNG and FPSO conversion works in the fourth quarter, MMHE said. Turnover rose from MYR106.0m in the fourth quarter of 2015 to MYR130.8m in the most recent corresponding period. For the full year however revenue from this segment was still lower, falling to MYR444.6m from MYR466.7m previously

Looking ahead, MMHE expressed concerns that oil output cuts would be kept. “NOCs and IOCs are expected to adopt the same strategy on deferment and scale-down of upstream projects for the major part of the year.

“Coupled with geopolitical risk, any meaningful recovery in the demand for offshore structures is not anticipated to materialise until 2018 at least,” md and ceo Wan Mashitah Wan Abdullah Sani said.

About the Author

Vincent Wee

Hong Kong and South East Asia Correspondent

Vincent Wee is Seatrade's Hong Kong correspondent covering Hong Kong and South China while also making use of his Malay language skills to cover the Malaysia and Indonesia markets. He has gained a keen insight and extensive knowledge of the offshore oil and gas markets gleaned while covering major rig builders and offshore supply vessel providers.

Vincent has been a journalist for over 15 years, spending the bulk of his career with Singapore's biggest business daily the Business Times, and covering shipping and logistics since 2007. Prior to that he spent several years working for Brunei's main English language daily as well as various other trade publications.

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