QUARTERLY IR UPDATES 1 st Quarter 2019 Financial Results & - - PowerPoint PPT Presentation

1

QUARTERLY IR UPDATES

1st Quarter 2019 Financial Results & Updates

25th April 2019

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

3

4

Key Highlights

FINANCIALS

• Revenue of RM203.1 mil
• Pre-tax loss of RM29.5 mil

Heavy Engineering Unit (HEU) milestones:

• Awarded Frame Agreement for EPC of fixed offshore

structure works for PETRONAS for 6 years Marine Business Unit (MBU) milestones:

• Awarded Master Service Agreement for Integrated

Turnaround Main Mechanical & Maintenance Static from PETRONAS for 5 years

• Completed repair & maintenance of 18 vessels
• Secured 26 jobs

Contents

• Business Highlights
• Projects
• Financials
• Shareholding Information
• Key Focus Areas

5

6

Progress at 49.4% as at March 2019

Bokor Phase 3 Re-Development CPP

7

Progress at 99.7% as at March 2019

Gumusut-Kakap Phase II Extension Subsea Manifold

8

Progress at 99.9% as at March 2019

RAPID Package 3 Area 2

9

Progress at 99.9% as at March 2019

RAPID Package 14

10

Progress at 15.5% as at March 2019

Pluto Water Handling Module

11

Progress at 47.2% as at March 2019

Tembikai NAG Offshore Wellhead Facilities

12

Notable Marine Repair Projects delivered in Q1 2019

Vessel owner: Sovcomflot Deadweight: 93,486 tonnage Job scope: Dry docking & repair (1st special survey) Delivery date: 1 March 2019

LNG Carrier Velikiy Novgorod LNG Carrier Galicia Spirit

Vessel owner: Teekay Shipping Glasgow Ltd Deadweight: 79,166 tonnage Job scope: Dry docking & repair and ballast water treatment system installation Delivery date: 15 March 2019

13

Notable Marine Repair Projects delivered in Q1 2019 (2/2)

Vessel owner: Eaglestar Shipmanagement (L) Pte Ltd Deadweight: 83.400 tonnage Job scope: Afloat repair Delivery date: 4 March 2019

LNG Carrier Seri Amanah LNG Carrier Trinity Glory

Vessel owner: “K” Line LNG Shipping (UK) Ltd Deadweight: 79,605 tonnage Job scope: Dry docking & repair Delivery date: 19 March 2019

14

Progress at 58.4% as at March 2019

Dry Dock 3 (DD3)

Contents

15

• Business Highlights
• Projects
• Financials
• Shareholding Information
• Key Focus Areas

• Revenue
• HEU – Lower revenue from ongoing projects
• MBU – Higher revenue due to increase in LNG dry

docking activities

• Operating
• HEU – Increase in operating loss attributed to lesser

close-out of completed projects in the current quarter

• MBU – Decrease in operating loss contributed from the

higher revenue as well as other cost plus works in the current quarter

• Pre-tax loss
• Increase in pre-tax loss attributed to the lower revenue

from HEU 16

Financial Updates

Income Statement, Sequential Quarter

Income Statement (RM 'm) 1Q 2019 4Q 2018 Revenue Heavy Engineering Marine 203.1 125.4 77.7 273.2 224.0 49.2 Operating Loss Heavy Engineering Marine Others (29.3) (23.9) (7.5) 2.1 (29.2) 1.7 (33.0) 2.1 Finance Cost (0.2) (0.9) Share of Profit of JV

• 3.8

Pretax Loss (29.5) (26.3) Taxation (0.3) 0.5 Net Loss (29.8) (25.8) LPS (1.8) sen (1.6) sen

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

Income Statement (RM 'm) 1Q 2019 1Q 2018 Revenue Heavy Engineering Marine 203.1 125.4 77.7 188.3 111.3 77.0 Operating Loss Heavy Engineering Marine Others (29.3) (23.9) (7.5) 2.1 (24.8) (12.8) (7.2) (4.8) Finance Cost (0.2)

• Share of Loss of JV
• (0.5)

Pretax Loss (29.5) (25.3) Taxation (0.3) (0.3) Net Loss (29.8) (25.6) LPS (1.8) sen (1.6) sen

17

• Revenue
• HEU – Higher revenue recognised from higher

progress of ongoing projects

• MBU – Revenue was marginally higher mainly due to

revenue derived from LNG dry dockings that compensated the decrease in revenue for conversion works in the current quarter.

• Operating
• HEU – Higher operating loss attributed to higher

unabsorbed overheads as expected contract awards have yet to materialise.

• MBU – Operating loss comparable to the

corresponding quarter.

• Share of results of JVs
• Nil as all JVs have turned dormant since Q4 2018
• Pre-tax loss
• Pre-tax loss due to the operating losses incurred

Note : Segmental Revenue and Operating Profit is post inter-segment eliminations : Due to rounding, numbers may not tally with the total Financial Updates

Income Statement, Year-on-Year

18

• Total assets of RM3.2bil
• Higher Non-Current Assets – PPE, mainly due to

investment in DD3

• Higher Non-Current Liabilities – Further drawdown
• f financing facility to finance the construction of

DD3

• Lower Cash – Investment in DD3
• NTA per share of RM1.49

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

Balance Sheet (RM 'm) Mar 2019 Dec 2018 Non-Current Assets 1,982.2 1,905.6 Inventories 5.1 5.6 Receivables 676.1 648.0 Cash 517.2 601.5 Others 20.5 20.5 Total Assets 3,201.1 3,181.2 Shareholders' Funds 2,376.9 2,407.1 Non-Controlling Interests (0.7) (0.3) Long Term Loan 99.7 48.4 Long Term Lease Liabilities 18.8

• Payables

705.4 726.0 Short Term Lease Liabilities 1.0

• Total Equity & Liabilities

3,201.1 3,181.2 NTA per share RM1.49 RM1.50

Financial Updates

Balance Sheet

Marine Business Unit F12 Tembikai NAG CPP Bokor Sepat Phase 2A Besar Woodside Pluto CPOC

March 2019 RM864 mil

RAPID

19

Backlog & Order Intake

652 182 1,145 144 24 500 1,000 1,500 2,000 Dec15 Dec16 Dec17 Dec18 Mar19 1,023 629 1,273 785 864 500 1,000 1,500 2,000 Dec15 Dec16 Dec17 Dec18 Mar19

MHB Backlog

RM (‘000) RM (‘000)

* New Order Intake excludes Marine Business segment

Backlog New Order Intake

Turret

Contents

20

• Business Highlights
• Projects
• Financials
• Shareholding Information
• Key Focus Areas

Foreign Investors 2.24% Other Malaysian Shareholders 10.44% Lembaga Tabung Angkatan Tentera 2.25% EPF 1.63% PNB & PNB Unit Trust Funds 1.84% Urusharta Jamaah 6.60% Foreign Investors 2.44% Other Malaysian Shareholders 10.15% Lembaga Tabung Angkatan Tentera 2.25% EPF 1.66% PNB & PNB Unit Trust Funds 1.90% Urusharta Jamaah 6.60% 0.00 0.20 0.40 0.60 0.80 1.00 1.20 1.40 1.60 1.80 2.00 31-Dec-18 31-Jan-19 28-Feb-19

Corporate Updates

Shareholding Information & Share Price

As of 31 Dec 2018

21

As of 31 Mar 2019

Share Price (RM)

14/03/2019

0.86

Technip 8.50% 31-Mar-19 Technip 8.50%

0.55

31/12/2018

Contents

22

• Business Highlights
• Projects
• Financials
• Shareholding Information
• Key Focus Areas

23

Key Focus Areas

• HEU tenders worth ~ RM6.3 billion have been submitted as of March 2019
• 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 modular fabrication, offshore wind farm and plant turnaround

work

• Deployed

a number

• f

in-house processes and explore strategic partnership and collaboration opportunities to promote competitive price offerings

• Implement productivity improvement initiative to achieve operational excellence
• Upskill manpower through capability development programmes

24