Tuesday, June 28, 2011

Muhibbah: No writedown for APH project

Muhibbah Engineering (M) Bhd believes it will not have to write down as much as RM300 million due to its involvement in the Asia Petroleum Hub (APH) Sdn Bhd project in Johor.

Managing Director Mac Ngan Boon said this was despite the fact that Asia Petroleum Hub was actively speaking to potential investors and hoped for a resolution as soon as possible.

"We don't wish there will be a write down. We believe there are other solutions," he said when commenting on recent news that the company has been placed under receivership by CIMB Bank Bhd mainly as the former was unable to bring in other investors to help fund development and repay its borrowings.

Earlier, he attended the company's annual general meeting.

APH is the developer and operator of the APH Oil Terminal in Tanjung Bin, Johor, and had awarded Muhibbah Engineering the marine piling and jetty work worth RM820 million.

However, cost escalation due to APH funding issues led to the stalling of payments due to Muhibbah Engineering.

Muhibbah Engineering, in a filing to Bursa Malaysia recently, had said APH had identified an investor and was negotiating to fully finance completion of the project.

Mac said the bankers and APH will have to sit down and talk to continue the project as it was a national project and has to be completed.

On another matter, Mac said Muhibbah Engineering had bidded for few jobs involving the Light Rail Transit (LRT) extension project in Klang Valley.

The proposed Kelana Jaya LRT extension line will run from Lembah Subang-Kelana Business Centre through Subang, USJ, Alam Megah and ends at the hub in Putra Heights.

The proposed line, comprising 13 stations, will cover about 17km.

The proposed Ampang LRT extension line will run from the present Sri Petaling station, through Puchong, Kinrara and ends at the hub in Putra Heights.

Meanwhile, Mohamed Taib Ibrahim, Muhibbah Engineering chairman and independent non-executive director, said the company will continue to focus on its core capabilities and build on its inherent competitiveness.

He said the group will continue to leverage on its established track record and expertise.

"Our position as a crane manufacturer and a vessel builder as well as an oil and gas infrastructure construction specialist within the oil and gas industry will ensure the group's ongoing growth and development for the years ahead," he said.

He said Muhibbah Engineering recorded RM1.77 billion lower sales revenue for last year compared with RM2.25 billion in 2009.

Mohamed Taib said this was due to a lower turnover for the construction and crane divisions.

Nevertheless, he said, the company recorded a higher net profit after tax and minority interests of RM32.94 million last year as compared to RM16.98 million in 2009.

"This was mainly due to better efficiency from our crane and shipyard subsidiaries," he added. -- Bernama

Read more: Muhibbah: No writedown for APH project http://www.btimes.com.my/Current_News/BTIMES/articles/20110628211012/Article/index_html#ixzz1QZmKcOni

Liang Chai Comments: Muhibah really dare to annnoucement the news like that... 4 8 terrible.

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