Monday, February 28, 2011

Malaysian Companies With Middle East Exposure

Malaysian Companies With Middle East Exposure


Ranhill is not ready to say anything about its operations in Libya as it is unsure of the situation in the country. Ranhill is involved in a US$1.2 billion (RM3.66 billion) Tajura Housing Project, which involves the design and construction of 10,680 units of residential apartments in Tripoli , Libya . The project, due for completion in February 2013, was contracted by the Housing and Infrastructure Board of the Libyan Government to Amona Ranhill Consortium, a Ranhill subsidiary.

MMC Corp

Its exposure in Middle East is in the development of the Red Sea terminal, power and water projects and is joint master developer of Jazan Economic City in Saudi Arabia .

Financial Impact: The engineering and construction division, posted a segmental profit of rm5.3 million on revenue of RM40.2 million in FY2008. In FY2009, although revenue dipped by more than 80%, the company made losses of RM8.5 million.

Sime Darby

The company was awarded a number of projects in the Middle East over the past the four years (2007-2010).

Financial Impact: Estimated losses for FY2009-FY2010 for its Middle East to be Billions of Ringgit.


Its overseas exposure were from contracts in Saudi Arabia , Abu Dhabi and Indonesia .

In FY2009, some 90% of the total construction order book were foreign. In Aug 2009, it reported that the order book of Rm1.8 billion would last till the 4Q2010.

Its Middle Eastern order book consists of mainly power plant construction project.

Financial Impact: It registered net losses of rm184 million for three months ended march 2010, a deterioration from the previous quarter’s loss of rm58 million.


The company has been successful in completion of projects and payment collection but is being sued by Bahrain Asphalt Establishment for alleged prolongation, among other allegations.

LCL Corp

The company fell into PN17 status with creditors and banks demanding repayment due to Dubai ’s bubble burst.

Financial Impact: It posted a net profit of RM9.8 million in FY2008 following the Dubai crash. It posted large net losses of rm391 million in FY2009 and RM130 million in 1DFY2010.


The group completed a number of projects in the Middle East .

Financial Impact: The company is facing arbitration in relation to the cancelation of the Nad Al Sheba Racecourse in Dubai and a request for arbitration as a result of the Dukhan Highway project.

WCT is one of the defendants, who are liable to pay RM101 million collectively if the case is successful.


Its Middle East order book was particularly disappointing with respects of delays and cost overruns, particularly for its Yemen LNG project.

Financial Impact: In FY2007, the infra and construction division’s pre tax totaled RM34 million on revenue of rm745 million.

In FY2008 and FY2009, although revenue doubled from FY2007 levels, this division posted losses of RM21 million and Rm38 million respectively, due to additional costs incurred on the Yemen project.


shy away from these companies, as situation will be going worst.........