MISC Bhd. Profit Fell on Compensation for Renegotiated Contract, Costs Provisions
By Ying Xian Wong
MISC Bhd.'s third-quarter net profit fell 48% compared with the same period a year earlier, weighed by contract compensation and additional cost provisions.
The Malaysian energy-shipping company said Wednesday that its third quarter net profit was 430.4 million ringgit ($92.5 million) as revenue fell 6.9% on year to MYR3.37 billion.
Its petroleum and product shipping segment's operating profit was 37% lower due to a one-off compensation owing to a renegotiated contract. Operating profits for its offshore business segments fell 69% due to lower revenue from construction of floating production storage and offloading vessels as well as additional cost provisions.
Its marine and heavy engineering segment swung into an operating loss as it was also hit by higher cost provisions.
Moving forward, MISC expects prospects for the liquefied natural gas shipping market to remain supported by growing global LNG demand and additional LNG infrastructure investments.
Petroleum shipping market rates may strengthen for the rest of 2023 amid strong seasonal demand, it said.
Demand for FPSO vessels is likely to remain positive given some of its global competitors face sanctions, and MISC added that its offshore business segment "will selectively pursue new opportunities in the market" as well as minimize ongoing projects costs.
MISC reckons its marine and heavy engineering segment will remain challenged by higher costs and stiff competition.
Write to Ying Xian Wong at yingxian.wong@wsj.com
(END) Dow Jones Newswires
November 22, 2023 00:57 ET (05:57 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.-
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