KUALA LUMPUR: Malaysia Marine and Heavy Engineering Holdings Bhd (MMHE) posted a net profit of RM15.3 million for the third quarter of 2024 (3Q24), a significant turnaround from a net loss of RM105.2 million in the same period last year.
According to its filing on Bursa Malaysia, its revenue for the quarter rose 41.9 per cent to RM906.4 million from RM638.4 million, driven by stronger performance in both its heavy engineering and marine segments.
The heavy engineering segment contributed RM799.9 million in revenue, an increase of RM229.7 million from RM570.2 million a year ago, attributed to higher contributions from ongoing projects.
Additionally, the marine segment recorded RM106.5 million in revenue, up RM38.3 million from RM68.2 million in the corresponding quarter, primarily due to increased dry-docking and repair activities.
Looking ahead, MMHE expects upstream capital expenditure in the heavy engineering segment to remain stable, supported by opportunities arising from ongoing energy security concerns and geopolitical tensions.
"While demand for oil and gas remains strong in the era of energy transition, the group aims to advance its growth by capitalising on the opportunities in both conventional and new energy sectors.
"Meanwhile, the marine segment aims to expand its conversion portfolio given the uptick in upstream activities," it said.
The company said the rapid expansion of the liquefied natural gas (LNG) fleet will benefit it in repair and maintenance services, although this may be offset by the expected deferment of LNGC dry-docking to meet robust demand in the upcoming winter.
Nevertheless, the company expects stiff competition to persist in the marine business with the Chinese and neighbouring yards.
"Current geopolitical conflicts are likely to continue affecting the supply chain, leading to price escalations and volatile operating landscapes.
"The group remains focused on improving its contracting strategies through a risk sharing arrangement such as alliance concept, reimbursable or cost-plus basis, in response to these challenging market conditions," it added.