Malaysia Marine and Heavy Engineering's Q2 net loss widens to RM13.7 million

PETALING JAYA: Malaysia Marine and Heavy Engineering Holdings Bhd's (MMHE) net loss widened to RM13.7 million for the second quarter ended June 30, 2017 against RM2.56 million in the previous corresponding period, due to fewer projects in progress and higher losses incurred for its joint ventures.
Revenue for the quarter under review fell 13.5% from RM297.44 million to RM257.27 million.
MMHE said in a filing with the stock exchange that the outlook remains challenging for the group with oil price not moving in line with the OPEC and non-OPEC voluntary cuts in production.
"Shale production activities is still robust resulting in a supply overload that will keep the price of oil subdued over the year and next," it noted.
With that, the group foresees the deferment of upstream projects to prolong and cost cutting measures will be enhanced further.
Nonetheless, MMHE said it remains committed to its strategy in managing cost, optimising its resources and improving operational efficiency in line with the challenging environment.
"While the group has successfully secured several contracts during the period, it is mindful that majority of the contribution will only be realised in 2018 and beyond. Diversification into new revenue streams that provide recurring income is a priority while efforts to replenish the order book continues," it added.
MMHE also saw a widened net loss of RM30.31 million for the first half of the year compared with RM10.14 million in the same period last year, with revenue declining 11% from RM554.16 million to RM493.11 million.
The stock was down by 2 sen to close at 71 sen on some 767,500 shares done, giving it a market capitalisation of RM1.14 billion.