KUALA LUMPUR (Oct 24): Malaysia Marine And Heavy Engineering Holdings Bhd (MHB) has narrowed its loss to RM4.66 million for the third quarter ended Sept 30, 2019 (3QFY19) from RM22.72 million a year earlier, helped by positive contribution from its marine segment.

The group said its marine segment posted an operating profit of RM2.5 million during the quarter, versus a loss of RM16 million in the corresponding quarter, when it recorded additional costs.

On the other hand, its heavy engineering segment posted a higher operating loss of RM6.8 million versus RM4.1 million in the previous year, as segment revenue fell following a decline in contribution from post sail away projects.

The group’s overall revenue for the quarter, however, fell 12% to RM254.35 million from RM289.8 million a year earlier, as contributions from its marine and heavy engineering segments declined.

For the nine months ended Sept 30, 2019 (9MFY19), MHB’s net loss shrunk to RM43.5 million from RM97.5 million in the previous year’s corresponding period, while cumulative revenue grew 5% to RM733.9 million from RM701.12 million.

Notwithstanding the improved quarterly performance, MHB said the short term outlook remains uncertain amid geopolitical tensions, slowing global economic growth, sluggish oil demand and ongoing unresolved trade conflict between the US and China.

“The group remains vigilant on the outlook for the heavy engineering business in the near term, due to the uncertainty on the timing of capital spending by major oil and gas players,” it said.

The marine business is also expected to remain challenging. While prospects for upgrading and retrofitting jobs are seen to improve, the group said some shipowners are thinking of reducing their dry docking repair costs in the current volatile market.

“The group is cautiously optimistic on the recovery of the industry, should there be a resolution of the trade dispute currently impacting the global economy. It shall continue to focus on replenishing its order book in various geographical areas, as well as diversifying into new businesses.

“Improving profitability remains the group’s priority by continuously exercising cost optimisation efforts and ensuring quality and timely delivery of projects,” MHB said.

MHB shares rose 0.5 sen or 0.55% to 91.5 sen today, giving it a market capitalisation of RM1.46 billion.