TH Heavy Engineering Bhd’s (THHE) net loss widened to RM89.48 million in the second quarter (2Q) ended June 30, 2018, against a net loss of RM16.79 million the year prior due to the recognition of impairment losses on FSPO Layang Vessel of RM708.7 million upon the completion of the JX Nippon contract novation.
Revenue for the period also dwindled to RM143,000 from RM2.38 million a year ago due to lower fabrication activities for the quarter, the engineering services company noted in a filing with Bursa Malaysia last Thursday.
As at June 30, the group, via its joint venture company THHE Destini Sdn Bhd, has a contract value for supply, delivery, testing and commissioning of three offshore patrol vessels for Malaysian Maritime Enforcement Agency worth RM697.4 million.
The group expects the fabrication business to remain challenging in view of the present competitive environment and capex cut as announced by major oil companies.
THHE has expanded into shipbuilding activities and plans to further diversity into refurbishment and maintenance works as well as non-oil and gas related fabrication works which is expected to provide a more stable and recurring income to the group.