KUALA LUMPUR: Boustead Heavy Industries Corporation Bhd (BHIC) posted a net loss of RM11.9 million for its third quarter of financial year ended 2024 (3QFY24), compared to a net loss of RM5.7 million the same period a year ago.
This was despite a 86 per cent jump in revenue to RM71.7 million from RM38.5 million the year before, driven by In-Service Support 2 (ISS 2) for Royal Malaysian Navy (RMN) submarines, and RMN submarine facilities upkeep contracts.
"The LAT (loss after tax) was primarily due to a one-off fair value loss of RM14.8 million related to the disposal of Contraves Advanced Devices Sdn Bhd (CAD).
The disposal reflects BHIC's strategic realignment, allowing the group to exit the Littoral Combat Ship (LCS) business, which had become non-core, and redirect resources toward growth-centric defense and commercial opportunities," the company said.
BHIC chief executive officer Feroz Razi Ramli said, the group expects the submarine contracts and the ISS for Royal Malaysian Air Force EC725 helicopters and the supply and delivery of spares, maintenance and training for RMNs Bofors 40MM L70 gun contracts to contribute positively to earnings in FY24.
"Our strategic focus on optimising resources and strengthening our core competencies ensures that BHIC is well-prepared for future growth.
"While defense remains our key strength, we are actively pursuing opportunities to diversify our revenue streams and contribute to the commercial sector, creating a balanced and sustainable business model that benefits all stakeholders", he added.
Boustead Holdings Bhd (BHB) group chief executive officer Izaddeen Daud said the government's continued emphasis on strengthening maritime defense, including initiatives involving helicopters, submarines, and defense systems, presents significant opportunities for BHIC.
"As part of the Armed Forces Fund Board (LTAT) and the defense arm of BHB, BHIC is uniquely positioned to play a pivotal role in advancing Malaysia's defense capabilities while contributing to national security and economic development," he added.
For the nine month period ended Sept 30, 2024 (9MFY24), BHIC recorded a net profit of RM6.54 million, compared to a net loss of RM7.16 million the same period last year.
Meanwhile, its revenue saw a jump to RM191.81 million, from RM77.6 million.