CGC lodges police report over misrepresentation
PETALING JAYA: Malaysia Marine and Heavy Engineering Holdings Bhd (MMHE) plans to increase capital expenditure (capex) by three folds this year compared to last year to take advantage of the busier oil and gas (O&G) industry.
According to managing director and chief executive officer Wan Mashitah Wan Abdullah Sani, the O&G fabricator may spend about RM150mil for its capex in the financial year ending Dec 31, 2018 (FY18), which will largely be used for the construction of a new dry-dock facility.
“We will be spending more from our cashflow for capex-related purposes. Our capex target for FY18 is about RM150mil, up from nearly RM50mil a year earlier,” she told reporters after the company’s AGM.
On MMHE’s ongoing “Dry Dock 3” construction, Wan Mashitah said the company expected to spend RM500mil over the next two to three years.
The new dry dock, which will expand the capacity of MMHE’s marine repair and refurbishment business, is expected to be completed by the second quarter of 2020.
The dry dock is currently 15% complete. Wan Mashitah said the recovery in global oil prices has led to an improvement in the O&G industry.
“We see some clients revalidating back some of the previous tenders that they have put on hold previously. There are positive signs that the O&G industry is moving in the right direction.
“In line with this, we believe the oil price has bottomed out. However, despite the improvement, everyone is still cautious about the development in the industry,” she said.
MMHE, which returned to the black in FY17, expects to maintain its financial performance or register a higher profit in the current financial year.
The O&G fabricator’s tender book currently stands at RM2.8bil, of which 46% represent domestic tenders while the balance from international projects.
Chairman Datuk Nasarudin Md Idris said the company would continue with its cost optimisation initiatives to streamline operations.
“I think the main challenge is that the jobs are very scarce because of the volatility in oil prices. A lot of investment decisions by major oil players have been deferred. Many of them have not taken the final investment decisions on their development projects.
“Thus, as a player in the industry, we are severely impacted as jobs are scarce and the jobs are also heavily contested. Margins are often squeezed.
“In order for us to actually win new jobs, we have to begin this initiative in terms of looking at ways and means to reduce cost. Generally, cost optimisation is the key thing,” he said.
Under its cost optimisation efforts, MMHE has reduced overhead costs over the last two to three years. The company’s employee count has also been reduced significantly, from 4,000 to the current 2,100. PETALING JAYA: Credit Guarantee Corp Malaysia Bhd (CGC) has cautioned the public to be wary of companies using its company logo and names of its personnel to offer financing.
In a statement, CGC stressed that it did not appoint third-party companies to act for or on behalf of the company with regard to its products and services.
CGC said it had lodged a police report over misrepresentation after receiving complaints about a “CGC Enterprise” which allegedly used its logo and names of its personnel to offer financing and loans.
It said “CGC Enterprise” was not related in any way to CGC or its subsidiary.
It urged those approached by third-party companies claiming to be employees or agents of CGC to contact its client service centre at 03-78800088 or e-mail csc@cgc.com.my.