QUARTERLY IR UPDATES 1st Quarter 2020 Financial Results & Updates 29th April 2020
Disclaimer 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. Quarterly IR Updates 2
1 Business Highlights Projects Financials Shareholding Information Key Focus Areas Quarterly IR Updates 3
Key Highlights in Q1 2020 FINANCIALS • Revenue of RM346.4 mil • Pre-tax profit of RM5.6 mil HEAVY ENGINEERING BUSINESS MILESTONES: • Completed construction of FSO Golden Star External Turret • Awarded contract for onshore fabrication and offshore modification services for CPOC facilities MARINE BUSINESS MILESTONES: • Completed repair & maintenance of 15 vessels • Secured 24 jobs Quarterly IR Updates 4
Business Highlights 2 Projects Financials Shareholding Information Key Focus Areas Quarterly IR Updates 5
Completed in March 2020 Golden Star External Turret Slide Title 6
Progress is at 76.93% as of March 2020 Bokor Phase 3 Re-Development CPP Slide Title 7
Progress is at 98.65% as of March 2020 Pluto Water Handling Module Slide Title 8
Progress is at 10.49% as of March 2020 EPCIC Kasawari Gas Development Project Slide Title 9
Progress is at 45.95% as of March 2020 MRU-Integration Slide Title 10
Progress is at 25.84% as of March 2020 Bekok Oil Project Slide Title 11
Notable Marine Repair Projects Delivered in Q1 2020 – Gas (1/2) LNG Seri Begawan Vessel owner: MISC Berhad Deadweight: 89,902 tonnage Job scope: Drydocking & Repairs and Ballast Water Treatment System Installation 16 th January 2020 Delivery date: VLGC Mistral Vessel owner: Frontline Management AS Deadweight: 53,854 tonnage 1 st Special Survey Drydocking & Repairs and Scrubber Job scope: Installation 22 nd February 2020 Delivery date: Quarterly IR Updates 12
Notable Marine Repair Projects Delivered in Q1 2020 – Gas (2/2) VLGC Monsoon Vessel owner: Frontline Management AS Deadweight: 53,752 tonnage 1 st Special Survey Drydocking & Repairs and Scrubber Job scope: Installation 3 rd March 2020 Delivery date: VLGC Levant Vessel owner: Frontline Management AS Deadweight: 53,659 tonnage 1 st Special Survey Drydocking & Repairs and Scrubber Job scope: Installation 20 th March 2020 Delivery date: Quarterly IR Updates 13
Docking Essential Defect (DED) for KD GEMPITA Notable MMHE EPIC Marine & Services Sdn Bhd (MEMS) Projects Slide Title 14
Progress is at 91.88% as of March 2020 Dry Dock 3 (DD3) Slide Title 15
Business Highlights Projects 3 Financials Shareholding Information Key Focus Areas Quarterly IR Updates 16
Financial Updates Income Statement, Sequential Quarter Income Statement (RM 'm) 1Q 2020 4Q 2019 Revenue 346.4 275.6 Heavy Engineering 226.8 148.5 Marine 119.7 127.1 • Revenue • Increase in revenue mainly due to higher revenue from Operating Profit/(Loss) 5.6 1.6 the Heavy Engineering segment Heavy Engineering 1.2 (10.3) Marine (1.5) 5.2 • Operating Profit Others 5.8 6.8 • Reported operating profit in tandem with the higher revenue and improved performance in the Heavy Finance Cost - - Engineering segment Share of Results of JV - 1.3 • Pre-Tax Profit Pretax Profit/(Loss) 5.6 3.0 • Reported higher pre-tax profit mainly due to higher revenue and improved performance in the Heavy Taxation (0.1) 6.4 Engineering segment Net Profit/(Loss) 5.5 9.4 EPS/(LPS) 0.4 sen 0.6 sen Note : Due to rounding, numbers may not tally with the total Quarterly IR Updates 17
Financial Updates Income Statement, Year-on-Year Income Statement (RM 'm) 1Q 2020 1Q 2019 • Revenue Revenue 346.4 203.1 Heavy Engineering • Heavy Engineering – Increase in revenue mainly 226.8 125.4 Marine 119.7 77.7 contributed by higher revenue from on-going projects • Marine – Improved revenue mainly contributed by the Operating Profit/(Loss) 5.6 (29.3) increase in revenue from LPG vessels and conversion Heavy Engineering 1.2 (23.9) work Marine (1.5) (7.5) Others 5.8 2.1 • Operating Profit • Heavy Engineering – Recorded operating profit mainly Finance Cost - (0.2) due to reversal of cost provision in the current quarter • Marine – Lower operating loss in tandem with higher revenue Share of Results of JV - - Pretax Profit/(Loss) 5.6 (29.5) • Share of Results of JVs • No share of profit in joint ventures in the current quarter Taxation (0.1) (0.3) as all have become dormant Net Profit/(Loss) 5.5 (29.8) • Pre-Tax Profit • Achieved pre-tax profit mainly due to higher revenue and EPS/(LPS) 0.4 sen (1.8) sen improved performance in both segments Note: 1. Segmental Revenue and Operating Profit is post inter-segment eliminations 2. Due to rounding, numbers may not tally with the total Quarterly IR Updates 18
Financial Updates Balance Sheet Balance Sheet (RM 'm) Mar 2020 Dec 2019 Non-Current Assets 2,076.4 2,034.9 Inventories 3.3 4.4 Receivables 615.1 504.1 • Total assets of RM3.4bil Derivatives 7.8 - Higher Non-Current Assets – Increase in Cash 651.0 673.9 ▪ Others 0.8 0.8 Receivables and PPE Total Assets 3,354.3 3,218.0 ▪ Higher Non-Current Liabilities – Higher payables and borrowings from additional disbursement of Shareholders' Funds 2,387.7 2,372.3 loan for the construction of Dry Dock No. 3 Non-Controlling Interests 8.6 9.2 ▪ Lower Cash – Outflow on the remaining capital Long Term Loan 208.6 178.9 spending for the construction of Dry Dock No. 3 Long Term Lease Liabilities 9.6 8.6 • NTA per share of RM1.50 Payables 739.3 645.5 Short Term Lease Liabilities 0.5 2.0 Derivatives - 1.6 Total Equity & Liabilities 3,354.3 3,218.0 NTA per share RM1.50 RM1.49 Note : Due to rounding, numbers may not tally with the total Quarterly IR Updates 19
Backlog & Order Intake Backlog RM (‘000) 3,500 MHB Backlog as of 3,000 31 March 2020 2,500 2,000 1,500 2,958 2,735 Heavy Engineering 1,000 Unit 1,273 96.8% 500 785 629 0 Dec16 Dec17 Dec18 Dec19 Mar20 New Order Intake RM (‘000) RM2,734.5 mil 2,500 2,000 1,500 2,644 1,000 1,145 500 Marine Business - Unit 182 144 0 3.2% Dec16 Dec17 Dec18 Dec19 Mar20 Note: 1. New Order Intake excludes Marine Business segment 2. No New Order Intake as of March 2020 Quarterly IR Updates 20
Business Highlights Projects Financials 4 Shareholding Information Key Focus Areas Quarterly IR Updates 21
Corporate Updates Shareholding Information & Share Price Share Price (RM) 6.62% 2.00 8.87% 1.80 8.50% 1.60 0.96 As of 07/01/2020 31 Mar 2020 1.40 6.60% 2.91% 1.20 66.50% 5.33% 9.81% 1.00 0.29 0.80 19/03/2020 8.50% As of 0.60 31 Dec 2019 6.60% 0.40 MISC 3.26% Foreign Investors 66.50% 0.20 Urusharta Jamaah 0.00 Technip 1/Jan/20 1/Feb/20 1/Mar/20 31/Mar/20 Other Malaysian Shareholders Others Note: Others include the following: Dec-19 Mar-20 Lembaga Tabung Angkatan Tentera (LTAT) 2.23% 2.23% EPF 1.60% 2.29% Amanah Trustees 1.50% 2.10% Quarterly IR Updates 22
Business Highlights Projects Financials Shareholding Information 5 Key Focus Areas Quarterly IR Updates 23
Backlog & Order Intake Heavy Engineering RM17.03 billion have been submitted as of March 2020 Tenders Worth Continue pursuing existing business of Marine & Heavy Engineering and expanding marine capacity through additional dry dock Continue exploring new business opportunities namely modular fabrication and offshore wind farm Strategy & Initiatives Reinforce internal process control and strengthening project planning Implement productivity improvement initiative to achieve operational efficiency Upskill manpower through capability development programs Quarterly IR Updates 24
Quarterly IR Updates 25
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