QUARTERLY IR UPDATES - MHBmhb.com.my/wp-content/uploads/2018/10/MHB-Analyst...Job scope: Dry docking...

QUARTERLY IR UPDATES

3rd Quarter 2018 Financial Results & Updates

24th October 2018

Disclaimer

2

This Presentation is not intended to form the basis of any investment decision with respect to Malaysia Marine and

Heavy Engineering Holdings Berhad (MHB). Neither this presentation nor anything contained herein shall form the basis

of, or be relied upon in connection with, any contract or commitment whatsoever. No representation or warranty, express

or implied, is or will be made by MHB in relation to, and no responsibility or liability is or will be accepted by MHB as to

the accuracy and completeness of, the Information made available, and any liability therefore is expressly disclaimed.

This Presentation may contain “forward-looking statements”. Forward-looking statements by their nature involve known

and unknown risks, uncertainties and other factors that are in many cases beyond MHB’s control. Although MHB

believes that the expectations of its management as reflected by such forward-looking statements are reasonable based

on information currently available to it, no assurances can be given that such expectations will prove to have been

correct. Accordingly, you are cautioned not to place undue reliance on such forward-looking statements. In any event,

these statements speak only as of their dates, and MHB undertakes no obligation to update or revise any of them,

whether as a result of new information, future events or otherwise.

This Presentation and its contents are strictly confidential and must not be copied, reproduced, distributed, summarized,

disclosed referred or passed on to others at any time without the prior written consent of MHB. Except for the yard

facilities in the photographs, none of the vessels/structures belong to MHB.

Contents

• Business Highlights

• Projects

• Financials

• Shareholding Information

• Key Focus Areas

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4

Key Highlights

FINANCIALS

• Revenue of RM701.1 mil

• Pre-tax loss of RM97.8 mil

Heavy Engineering Unit (HEU) milestones:

• Sail-away of five units of Dangote CALM Buoy

• Completion of centralised piping fabrication for RAPID

Package 5

• Completion of FSO Benchamas 2 turret

• Sail-away of Sepat-A jacket and topside

Marine Business Unit (MBU) milestones:

• Sail-away of FSO Benchamas 2

• Sail-away of FSO Bergading

• Completed repair & maintenance of 66 vessels

• Secured 82 new jobs

Contents


• Projects

• Financials


• Key Focus Areas

5

6

Sailed away on 6th March 2018

Dangote CALM Buoy

7

Completed on 5th January 2018

RAPID Package 5 - Centralised Piping Fabrication (CPF)

8

Sailed away in April 2018

Sepat-A WHP Topside & Substructure

9

Sailed away on 9th April 2018

FSO Benchamas 2

10

Sailed away on 28th June 2018

FSO Bergading

11

Progress at 25.1% as at September 2018

Bokor Phase 3 Re-Development CPP

12


RAPID Package 5 – Refinery of Gas (ROG)

13


RAPID Package 3 Area 2

14


RAPID Package 14

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Notable Marine Repair Projects delivered in Q3 2018 (1/2)

Vessel owner: Eaglestar Marine Holdings (L) Pte. Ltd

Deadweight: 76,229 tonnage

Job scope: Dry docking and repair

Delivery date: 11 July 2018

LNG Carrier Puteri Mutiara Satu LNG Carrier Seri Alam




Delivery date: 22 July 2018

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Notable Marine Repair Projects delivered in Q3 2018 (2/2)




Delivery date: 20 August 2018

LNG Carrier Seri Bijaksana LPG Carrier Astomos Venus

Vessel owner: Idemitsu Tanker Co., Ltd.



Delivery date: 19 September 2018

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Dry Dock 3 (DD3)

Contents

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• Projects

• Financials


• Key Focus Areas

• Revenue

• HEU – Higher revenue mainly due to commencement of

new order intake and from ongoing projects

• MBU – Increase in revenue from higher dry docking

activities in the current quarter

• Operating

• HEU – Lower operating loss mainly due to finalisation of

completed projects in the current quarter

• MBU – Lower operating loss mainly from recognition of

VO revenue offset with higher cost for conversion works

in the current quarter

• Pre-tax loss

• Lower loss in tandem with higher revenue from both HEU

and MBU

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Financial Updates

Income Statement, Sequential Quarter

Income Statement (RM 'm) 3Q 2018 2Q 2018

Revenue

Heavy Engineering

Marine

289.8

178.4

111.4

223.0

137.7

85.3

Operating Profit/ (Loss)

Heavy Engineering

Marine

Others

(22.7)

(4.1)

(16.0)

(2.6)

(49.5)

(24.0)

(25.6)

0.1

Share of Profit/ (Loss)

of JV - (0.2)

Pretax Profit/ (Loss) (22.7) (49.7)

Taxation (0.1) (0.1)

Net Profit/ (Loss) (22.8) (49.8)

EPS/ (LPS) (1.4) sen (3.1) sen

Note : Due to rounding, numbers may not tally with the total

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Financial Updates

Income Statement, Year-on-Year

• Revenue

• HEU – Lower revenue recognised on the back of fewer

ongoing projects in hand

• MBU – Lower revenue due to lesser dry docking repair

works secured

• Operating

• HEU – Lower operating loss due to finalisation of

completed projects

• MBU – Recorded an operating loss mainly due to

additional costs incurred on conversion works where

revenue recognition are still pending verification and

lower margins earned on dry docking works

• Share of results of JVs

• Lower loss following planned cessation of operations in a

JV

• Pre-tax loss

• Higher pre-tax loss due to operating loss incurred in MBU

Income Statement (RM 'm) 9M 2018 9M 2017

Revenue

Heavy Engineering

Marine

701.1

427.4

273.7

708.5

429.0

279.4

Operating Profit/ (Loss)

Heavy Engineering

Marine

Others

(97.0)

(40.6)

(48.8)

(7.7)

(9.3)

(48.3)

40.7

(1.7)

Share of Profit/ (Loss)

of JV (0.8) (6.0)

Pretax Profit/ (Loss) (97.8) (15.3)

Taxation (0.5) 0.6

Net Profit/ (Loss) (98.3) (14.7)

EPS/ (LPS) (6.1) sen (0.9) sen

Note : Segmental Revenue and Operating Profit is post inter-segment eliminations

: Due to rounding, numbers may not tally with the total

21

Financial Updates

Balance Sheet

• Total assets of RM3.1bil

• Higher Non-Current Assets – PPE, mainly due to

investment in DD3

• Lower Receivables & Payables – Ongoing projects are

still at early stages

• Lower Cash – Dividend payout and investment in DD3

• NTA per share of RM1.5

Note : Due to rounding, numbers may not tally with the total

Balance Sheet (RM 'm) Sep 2018 Dec 2017

Non-Current Assets 1,884.7 1,839.4

Inventories 5.1 2.4

Receivables 640.0 819.3

Cash 593.1 675.0

Others 20.3 20.9

Total Assets 3,143.3 3,356.9

Shareholders' Funds 2,434.3 2,579.7

Non-Controlling Interests 0.3 1.2

Payables 708.7 776.0

Total Equity & Liabilities 3,143.3 3,356.9

NTA per share RM1.5 RM1.6

22

Financial Updates

Backlog & Order Intake

2,559

356652

182

1,145

37Dec13 Dec14 Dec15 Dec16 Dec17 Sep18

420105

130

Order Intake RM million

2,556

1,5751,023

6291,273

932

Dec13 Dec14 Dec15 Dec16 Dec17 Sep18

Backlog RM million

New Order Intake

Call Out Contract

Backlog

Backlog

Note: New Order Intake excludes marine business

Marine Business UnitF12PFLNG Turret

CPP Bokor

Benchamas TurretBesar A

Rapid

CPOC

Others

September 2018

RM932 mil

Contents

23


• Projects

• Financials


• Key Focus Areas

Foreign Investors 2.50%

Other Malaysian Shareholders

12.43%

EPF 1.54%

PNB & PNB Unit Trust

Funds 1.84%

Lembaga Tabung Haji

6.69%

Technip 8.50%

As of

30 Jun 2018

Foreign Investors 2.50%

Other Malaysian Shareholders

12.43%

EPF 1.54%

PNB & PNB Unit Trust

Funds 1.84%

Lembaga Tabung Haji

6.69%

Technip 8.50%

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Corporate Updates

Shareholding Information

As of

30 Sep 2018

28-Sep-18

Share Price (RM)

21/09/2018

0.800.6225/07/2018

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

1.80

2.00

29-Jun-18 29-Jul-18 29-Aug-18

Contents

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• Projects

• Financials


• Key Focus Areas

26

Key Focus Areas

• Tenders worth ~ RM6.0 billion have been submitted as of September 2018

• Strategy & Initiatives

• Continue pursuing existing business of Marine & Heavy Engineering, seizing available

Floaters Conversion opportunities and expanding marine capacity through additional dry dock

• Develop new business, namely Onshore Construction & Fabrication and expanding Oil & Gas

Services for onshore and offshore

• Execute Bid Cost Reduction exercise to achieve better cost competitiveness

• Implement productivity improvement initiative to achieve operational excellence

• Up-skill manpower through Capability Development programme

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