Construction Financial Essays

Construction Financial Essays Construction Financial Essay Construction Financial Essay Muhibbah had its beginnings in 1972 when it was incorporated as specialist in marine and civil engineering and construction company. In 1994 the company was listed on the Main Board of Kuala Lumpur Stock Exchange (KLSE). From 1994 to 2000 Muhibbah was ventured into overseas market in Australia, Germany, Thailand and Sudan. In 2003 the company received International Achievement Award from Malaysian Construction Industry Development Board (CIDB) for recognition of involvement in oversea projects. In 2006 Muhibbah entered into overseas market in Yemen. Today, Muhibbah stands firm in the various discipline of engineering construction; such as construction of building structures, airport facilities, marine works, oil and gas, bridges and roads including provision of Intelligent Transportation System. Muhibbah is organised into four (4) core business segments which are Infrastructure Construction Division, Cranes Division, Shipyard Division and Concessions Division. The corporate structure is illustrated in figure 1. The company structure by core business segment and geographical segment are illustrated in figure 2 and 3. The infrastructure construction is the core business of Muhibbah group which contribute delivery 58% of the group income in year 2006. This segment engaged in construction projects, engineering contract works, oil and gas, and provision of technical assistance. A major achievement is the completion of the oil jetty at Horizon Oil Terminal in Jurong, Singapore had allows Muhibbah to tender for similar projects in the international market. In 2006, Muhibbah was successful in securing a contract from YEMGAS FZCO, Yemen LNG Jetty Works is the largest single project secured by the Group. In March 2007, the Group was awarded with the Petroleum Hub and Bunkering Facility project near Tanjung Pelepas. Muhibbah had success reinforced the reputation in amongst the global oil and gas companies and brought other opportunities to the Group as an integrated services provider for the oil and gas industry in all its core business divisions. Muhibbah also involved in cranes operation and its delivered 31% of the turnover to the group in year 2006. This division achieved a major milestone in its corporate restructuring with the listing of Favelle Favco Berhad to the Second Board of Kuala Lumpur Stock Exchange (KLSE) on 2006. The cranes segment is involved in the design, manufacture, supply, service and rental of cranes. The cranes divisions turnover significant increased further with continuing growth in offshore pedestal cranes from oil and gas companies worldwide and resurgence of strong demand for construction tower cranes. Shipyard Division The shipyard segment was contributed 11% of the group income in year 2006. This division has grown strongly and profitable over the years. The marine-ship building and ship repair segment provides ship building, ship repair, and marine-related services. Muhibbah have established good business relationships with reputable clients within the oil and gas related industry, with many repeat orders to build offshore vessels for the oil and gas industry. The continuing boom in the oil and gas industry increased the demand for offshore vessels to service the offshore platforms. This will be a good opportunity for the shipyard division to capitalise on the huge opportunities in the offshore oil and gas market for vessels. Concessions Division The concessions segment is an operator and concessionaire of airports, as well as provides operation and maintenance of roadways and bridges. The earnings for this segment are generated from Roadcare (M) S/B (Roadcare) and Societe Concessionaire de l Aeroport (SCA). SCA owns the exclusive rights for privatisation of international airports in Cambodia with concession periods up to 2040. Roadcare is principally involved in the maintenance and upgrading of roads, under a fifteen-year (15) concession period to maintain federal roads in the central states and the east coast of Peninsular Malaysia.