KUALA LUMPUR, Nov 27 (Bernama) -- TH Heavy Engineering Bhd’s net profit declined to RM2.67 million for the third quarter ended Sept 30, 2019 from RM100.76 million in the same period last year.
In a filing with Bursa Malaysia, the company attributed the lower profit to absence of waiver of debts as part of the Scheme of Arrangement, while the higher revenue was due to the recognition of revenue from the Offshore Petrol Vessel (OPV) Project during the quarter.
Revenue, however rose to RM12.02 million from RM79,000 previously.
On prospects, TH Heavy Engineering expressed cautious optimism on its business prospects in the non-oil and gas (O&G) sector, subject to the successful implementation of the proposed scheme of arrangement pending the issuance of Islamic irredeemable convertible preference shares (ICPS-i) to its creditors.
As at Sept 30, 2019, the group, via THHE Destini Sdn Bhd, a joint venture company between THHE Fabricators Sdn Bhd and Destini Shipbuilding and Engineering Sdn Bhd, has a contract value for supply, delivery, testing and commissioning of three units of OPV for Malaysian Maritime Enforcement Agency of RM738.9 million.
Additionally, as at Sept 30, 2019, the Group has a total contract value of US$9.7 million for the O&G business.
“Moving forward, the Group expects the fabrication business to remain challenging in view of the present domestic competitive environment. However, it is actively pursuing O&G business in overseas market.
“The group has expanded into ship repair and ship building activities and also plans to expand into the refurbishment and maintenance works and non-O&G related fabrication works, which is expected to provide a more stable and recurring income,” it added.