Muhibbah Engineering-led consortium bags RM240m job from Petronas unit

KUALA LUMPUR (Aug 30): A consortium led by Muhibbah Engineering (M) Bhd has won a RM240 million contract to undertake a job related to the Integrated Bekok Oil project located offshore Terengganu.

The contract was awarded by Petroliam Nasional Bhd (Petronas)’s subsidiary Petronas Carigali Sdn Bhd, said Muhibbah in a stock exchange filing.

The construction and engineering group did not reveal the names of the other members of the consortium nor its participating interest.

The contract is expected to be completed within 18 months and will contribute positively to its earnings and net assets for the current and future financial years, the group said.

2Q net profit up on lower tax expenses

In a separate filing, Muhibbah said its net profit grew 14.5% to RM1.34 million for the second quarter ended June 30, 2022 (2QFY22) from RM1.17 million a year ago, as a result of lower tax expenses.

Quarterly revenue, however, dropped 32% to RM196.43 million from RM289.47 million while operating profit fell 69% to RM5.89 million, from RM18.73 million.

Muhibbah said its crane production business was affected by the quarantine of certain operational staff due to Covid-19 cases while costs for components and shipping were higher as well due to the war in Ukraine.

For the first half of the year (1HFY22), the group’s net profit fell by 72% to RM1.81 million from RM6.49 million in the previous corresponding period, as revenue declined by 27% to RM371.62 million from RM507.52 million.

The group said its total outstanding orderbook in hand for construction and cranes divisions amounted to RM823 million as at Aug 23.

Going forward, Muhibbah said it will continue its efforts in improving cost efficiency and replenish its orderbook.

Shares of Muhibbah closed half sen or 1.2% higher at 43.5 sen on Tuesday, giving it a market capitalisation of RM316.22 million.