KUALA LUMPUR (Oct 22): KNM Group Bhd, which is involved in oil and gas (O&G) equipment and services, has secured a purchase order for the supply of air-cooled heat exchangers worth approximately RM111 million.

In a bourse filing on Friday (Oct 22), the group said its indirect wholly-owned subsidiary FBM Hudson Italiana SpA accepted the purchase order on the same day from engineetring outfit Bechtel International Inc.

Bechtel serves the energy, infrastructure, nuclear, security and environmental, and mining and metals markets. It is headquartered in Reston, Virginia, the US.

According to KNM, the supply and delivery duration of the transaction is a period of approximately 20 months from the date of the purchase order.

It said the contract is expected to contribute positively to the group’s earnings for the financial year ending Dec 31, 2022 (FY22) and FY23.

“The transaction is subject to certain commercial and financial risks, mainly in the power, O&G, petrochemical and energy industries.

"These include changes in general economic conditions such as but not limited to inflation, environmental, health and safety regulations, taxation, foreign exchange, interest rates, labour and material supply, changes in business and operating conditions such as but not limited to government and statutory regulations, and deterioration in prevailing market conditions," it said.

KNM said it is already operating in these industries and hence would continue to be exposed to risk factors that they currently face.

“Although KNM with its vast experience may undertake efforts to mitigate the various risk factors, there is no assurance that any change in the above risk factors will not have a material adverse effect on the business and operations of KNM,” the group added.

At Friday’s 12.30pm break, KNM shares settled half a sen or 2.27% higher at 22.5 sen, giving the group a market capitalisation of RM733.89 million.