KUALA LUMPUR: Malaysia Marine and Heavy Engineering Holdings Bhd's (MMHE) registered a wider net loss of RM107.79 million in the fourth quarter (Q4) ended December 31, 2021, from RM8.56 million a year ago.
Revenue also decreased 37.9 per cent to RM432.01 million from RM695.54 million last year due to the lower revenue from the heavy engineering and marine segment.
The heavy engineering segment recorded lower revenue of RM354.5 million in Q4 2021 than RM594.8 million in the same quarter in 2020, mainly due to lower revenue from ongoing projects.
The marine segment posted revenue of RM77.6 million in Q4 2021, RM23.1 million lower than RM100.7 million in the same quarter in 2020 due to lower drydocking activities.
For the year ended December 31, 2021 (FY21), the company posted a lower net loss of RM270.41 million from RM396.80 million last year.
The company revenue also decreased 6.4 per cent to RM1.47 billion from RM1.57 billion last year.
Managing director and chief executive officer Pandai Othman said the surge of Omicron variant cases globally had caused concerns for the oil and gas industry heading towards 2022.
Pandai said mini lockdowns to curb infections have already been implemented in several major oil-importing countries, thus slowing down demand recovery progress.
"Considering the renewed uncertainty along with the lasting impact of the pandemic and high material prices, oil majors are likely to continue spending modestly.
"As such, we remain cautious on the prospects for the heavy engineering segment," he said.
Meanwhile, Pandai said despite the rise in global gas prices, liquefied natural gas (LNG) demand from the Far East remains high and is expected to increase given another prolonged winter.
He said the resulting increase in LNG trade would result in more LNG vessel owners deferring drydocking, thus leading to stiffer competition amongst shipyards for the limited drydocking opportunities.
"Considering the continuing border restrictions worldwide, foreign clients will continue to prefer sending their vessels to other countries with more relaxed restrictions. Therefore, we expect the marine business to remain challenging.
"We are focused on replenishing our order book by pursuing business opportunities in new regions and segments.
"Additionally, we continue to prioritise cost management efforts as well as safe execution and timely delivery of ongoing projects," he added.