Malaysia Marine & Heavy Engineering Bhd (MMHE), Petroliam Nasional Bhd's deepwater fabrication arm, may face a slow order book replenishment this year, said HwangDBS Vickers Research Sdn Bhd.
In a research note today, HwangDBS said, for the first time in recent years,foreign firms were invited to bid for the contracts in Malaysia, which had been monopolised by MMHE in the past.
"Shell has formally invited international yards to participate in a re-tender for the tension leg platform fabrication job at Malikai deepwater field, offshore Sabah.
"The contract may be worth about RM1 billion. It is expected to be awarded by second half of 2012 as the bids are only due in April 2012," it said.
The research house said MMHE's outstanding order book stood at RM3.7 billion, and there was unlikely to be any major replenishment at least until after first half of 2012.
"This latest development reaffirms our concern over MMHE's weak earnings visibility. If there is no major replenishment in the next 12 months, its order book could drop below RM800 million by end 2012," it said.
Additionally, HwangDBS said, MMHE's estimated RM2.8 billion year to date contract wins may not be able to sustain its current RM4 billion annual burn rate. -- Bernama
In a research note today, HwangDBS said, for the first time in recent years,foreign firms were invited to bid for the contracts in Malaysia, which had been monopolised by MMHE in the past.
"Shell has formally invited international yards to participate in a re-tender for the tension leg platform fabrication job at Malikai deepwater field, offshore Sabah.
"The contract may be worth about RM1 billion. It is expected to be awarded by second half of 2012 as the bids are only due in April 2012," it said.
The research house said MMHE's outstanding order book stood at RM3.7 billion, and there was unlikely to be any major replenishment at least until after first half of 2012.
"This latest development reaffirms our concern over MMHE's weak earnings visibility. If there is no major replenishment in the next 12 months, its order book could drop below RM800 million by end 2012," it said.
Additionally, HwangDBS said, MMHE's estimated RM2.8 billion year to date contract wins may not be able to sustain its current RM4 billion annual burn rate. -- Bernama
