A very good evening, ladies and gentlemen. Thank you for participating in our fourth quarter financial year 2023 analyst briefing. I am Faisal from MISC's Investor Relations team. We have with us today Captain Rajalingam Subramaniam, President and Group CEO, joining us via Hong Kong. Encik Raja Azlan Shah Raja Azwa, Vice President, Finance and Corporate Planning. Encik Mohd Khairul Izzad , Senior General Manager, Group Finance. Mr. Gurkiran Kaur , General Manager, Corporate Planning. Before we start with the analyst briefing proceeding, I would like to invite Encik Raja Azlan to come and say a few words.
Thank you very much. A warm welcome to our friends from the analyst community, both the sell side and the buy side. Again, it is a pleasure for us to present to you our fourth quarter financial key highlights. We are very happy because the Mero 3 project has just sailed away last weekend, and we will talk a bit about that. We also have with us today the Vice President designate, Effendi. He will be taking over me insofar as the finance portfolio is concerned, effective 1st of March. He will be my partner together with Captain Rajalingam in terms of the engagement with the analysts. Without further ado, Faisal, let us proceed with the proceeding.
Thank you, Encik Raja Azlan. Before we proceed to the presentation, I would like to bring your attention to the disclaimer slide. This presentation contains some forward-looking statements with reference to our plans, expectations, whereby actual results could differ due to unknown risks, uncertainties and utterances which are in many cases beyond MISC's control. With that, I would like to invite Encik Raja Azlan again for his remarks on the quarter's key highlights and business updates. Encik Raja Azlan.
Thank you very much, Faisal. Let us go into the slides, please. I am pleased to report that we recorded a revenue, $915 million for the fourth quarter. This represents a 26% increase over the third quarter of this year. Profit after tax, we have recorded $134 million. This is a 56% increase in profit after tax compared to the third quarter of this year. Cash flow from operations at $433 million, also a very strong 47% increase compared to the third quarter of this year. You will be pleased that we also declared dividends of $0.12 for the fourth quarter, that will bring the total dividends for the whole year at $0.36 per share.
We are also happy to mention that on the 6th of November 2023, MISC and MHB both bagged the Silver Award under the Transport and Logistics sector, as well as the Silver Award under Green Transition under the Equities category at The Edge Malaysia ESG Awards. On the 16th of November, MISC Group once again top list of the best organizations in Malaysia for the outstanding safety performance at the 41st MSOSH Awards 2023. Across the group, we landed a haul of 6 awards. The recognition given by MSOSH is a testament to our dedication and commitment showcased by our colleagues, both at sea as well as at shore, in upholding occupational safety and health excellence. On the 1st of December 2023, Eagle Star was awarded with the Alternative Fuel Vessel Design of the Year at the Marine Fuel 360 Awards in Singapore.
This milestone recognition is a testament to our commitment to addressing the decarbonization challenges and achieving a 50% reduction and working towards achieving a 50% reduction in greenhouse gas emissions from our shipping operations by 2030. Next slide. Looking back at the year 2023, we were indeed very busy. We took delivery of two dual-fuel very large crude carriers, namely the Eagle Vellore as well as the Eagle Ventura to share. We also took delivery of two LNGCs, namely the Sri Damai and Sri Daya, which will be servicing SeaRiver Maritime under ExxonMobil. We also entered into a new partnership agreement with Nissen Kaiun for the sale and charter of two existing LNG carriers. MISC entered into a heads of agreement with Pengerang LNG2 for the supply, operation, and maintenance of an LNG FSU.
Also at the beginning of 2023, MISC entered into a $527 million syndicated loan facility agreement for the financing of six Very Large Ethane Carriers with Standard Chartered as the lead financial advisor. This is an 11-year sustainability-linked non-recourse term loan, and it was our debut within the sustainability-linked loan space. Marine Money linked to this have recognized MISC as the winner of the Sustainability Linked Deal of the Year award for Asia. The Singapore Registry of Ships Forum 2023 had recognized the Sri Damai and the Sri Daya with the prestigious Green Ship status under the Maritime and Port Authority of Singapore's Green Ship Programme. MISC received the Silver Award at The Star ESG Positive Impact Awards under the large companies tier for the environmental category, sustainability ecosystems.
AET Eagle Star were recognized with the Chamber of Shipping of America Awards at the Annual Safety Awards. The collective efforts of the two entities have set a good safety record without any long-term injuries for 48 vessels and have recorded a total of 328 years without LTI. During the year as well, MISC signed the term sheet with Petrobras CCS Ventures together with Mitsui O.S.K. Lines for the potential opportunity relating to the development and monetization of LCO2 carriers. MISC also secured approval in principle from DNV for its innovative floating CO2 storage unit, FS-FCSU concept that was jointly developed with Samsung Heavy Industries. MISC also unveiled its future-ready newbuild FPSO, known as the Mega-Module Engineering & Green Architecture FPSO.
MISC through its entities, AET and Malaysian Maritime Academy, inked milestone collaboration agreements with WinGD and DNV respectively to develop future-ready maritime talents and next generation modular engines. It was indeed a very busy year for us. We set the ground for collaborations with like-minded partners so that we are able to then move forward, pivoting into the green energy space. Next slide please. As I mentioned just now, we are very proud that the FPSO Mero 3 has sailed away on the 24th of February. Construction is completed and now the project is focusing on completing the pre-commissioning and the commissioning phase. It is a huge relief to see the asset sailing away and being towed to Brazil. Thank you very much. That is the opening, and I'll pass it back to emcee. President, thank you very much.
Thank you, Chair Raja Azlan. Thank you very much. We will now proceed with the presentation on financial performance by Mohd Khairul Izzad , followed by market outlook by [Inaudible] .
Great. Thank you. Let us begin with revenue side first. Revenue of $950 million was recorded for the quarter, and this is slightly lower by 0.5% if you compare to the corresponding quarter in 2022. This was mainly due to lower construction revenue from Mero 3 in the offshore segment following lower project progress. This was however offset with higher revenue from new and ongoing project in our heavy engineering segment. Comparing this to the preceding quarter, revenue of $950 million in Q4 2023 was higher by 36%, contributed by higher revenue from new and ongoing project in heavy engineering segment. Moving on to the profit before tax and operation, PBT from operations. Q4 2023, PBT from operation of $155 million was lower by 22.5% compared to Q4 2022 due to lower construction progress of Mero 3 as well as higher vessel operating cost in our gas segment.
Again, preceding quarter, our PBT from operation of $155 million was 55% higher, contributed by improved freight rates in the petroleum and product shipping segment, as well as recognition of cost recovery claim, in addition to additional cost provision for ongoing heavy engineering project recognized in Q3 2023 and primarily in our heavy engineering segment. Moving on next to PAT, profit after tax. Our PAT for Q4 2023 of $134 million was lower compared to Q4 2022 by 6.9%, in line with the lower PBT from operation, and this was offset with lower impairment provision in the current quarter. Comparing to the preceding quarter, PAT was higher by 56%, consistent with the increase in PBT from operation mentioned earlier. Cash flow from operation, CFO. Higher CFO in Q4 2023 by 17.7% Compared to Q4 2022, and 47.3% compared to Q3 2023, mainly from higher collections, the heavy engineering segment.
Let's go to balance sheet next. Our balance sheet as of 31st December 2023 remains solid with our total assets, equity, and liabilities remain fairly unchanged as compared to those of December 2022. Both our gross and net gearing ratio show an improvement from 0.547x to 0.44x , and 0.28x to 0.25x respectively, stemming from collectively lower borrowings, increased shareholder equity, and higher cash balances. Moving on to the next slide, please. Our cash balances continue to remain healthy at $1.7 billion as of the year-end, mainly due to the lower CapEx payment made during the year. While debt balances reduced from December 2022 balances following net repayment made during the year FY 2023. If I can go to the next slide, please. This slide actually summarizes the overall performance by each business segment across the three quarters.
For gas segment, revenue remains stable, backed by higher charter rates from the spot vessel as well as from existing portfolio of long-term contracts. However, in terms of EBITDA, the reduction in Q4 2023 was mainly due to higher vessel operating costs. Moving on to petroleum. Petroleum segment showed an increase in both revenue and EBITDA compared to the preceding quarter from improved trade rates in line with the seasonal shift towards winter months. Quarter to quarter, Q4, remaining stable. Going to offshore segment, revenue and EBITDA decreased from Q4 2022, mainly from lower project progress for Mero 3 as the project is nearing its completion stage. In addition to that, some cost provision for antecedent of an asset was made during the year. Last but not least, heavy engineering. Higher revenue across the three quarters contributed by higher progress from new and ongoing contracts.
EBITDA for Q4 2023 was contributed by the cost recovery claim recognized during the quarter. That's all from me. Thank you.
Thank you. Ms. [Liza Mustapha].
Thank you. Thank you, Faisal. Good evening, the analysts. I shall start off with the market environment slides. As you know, we performed very well financially. Let me take you through some slides to see how the market environment is developing. Let's start off with the LNG shipping segment. What we saw in quarter four was that there was a slight seasonal decline, as usual in the seasonal holidays, and there was also mild winter. As you can see from the graph, the spot rate remains elevated compared to historical levels. In the near term, however, we see that soft market conditions could take place as the fleet capacity grows. With regard to prospects, we do see that a strong LNG demand from Asia and also the developing LNG investment infrastructures that's happening across the globe.
We also see that moving forward, there are regulations coming into play, and also the rerouting of the vessels via Cape of Good Hope. This is because of the restrictions of the Panama Canal. All these will not hamper the rates that we see moving forward. The LNG segment remains stable and is supported by our portfolio charters. Moving on. The LNG shipping FID outlook, we do see a capacity there, an increase in 2024. You see an increase in 2024 from the 69 of pre-FIDs to 133 that's expected moving forward. The global LNG liquefaction capacity is expected to increase by an average annual growth rate of about 10.7%. It is looking good and there is rising demand globally, especially in Asia as mentioned before.
In terms of the new buildings, the new building orders, we do see that the order book is currently at 52% of the current fleet size. That's about 353 vessels as of December. Much lower than 2022, simply because there's limited shipyard capacity under seven, and also the high building prices for modern carriers are on the high side. It's about $265 million on average. QatarEnergy is expected to dominate the newbuilding in 2024, as you see it. As for the secondhand values, there is no change to the current rates. We see that there are some opportunities for conversion. On the petroleum segment, it's a different story altogether. We can see the rates are way higher than what the LNG, based on previous years, for example. The rates are very much firm. The average prices are on the rise.
Quarter four is on the rise on the various segments. Both spot and term are on the higher side. Despite the new OPEC output cuts. Therefore, the near term still looks positive. We do see strong Atlantic exports and imports are mostly from Asia. On the MISC side, we see growth on the dual fuel. As for the order book for the tanker segment, there is very little. The order book ratio currently is at 4.2%, and it is way lower compared to the historical average. We expect the tonnage to be squeezed further in the next few years.
Demolition activities, very low demolition activity is observed simply because of the increased demand for old tonnage as well for second-hand, and that many of the vessels on the current fleet are built in 2002, which means that scrapping will probably come in 2027, we see it. On the offshore segment, it remains positive. There's an uptick of about 6% in terms of global offshore E&P CapEx expenditure. The awards that we see coming forward would probably come from Latin America and the Asia-Pacific regions. Therefore, it's looking good. Next slide. My last slide, this basically tells us that even though there is a rising prices in terms of development costs, the economics of most of these projects are still quite robust and should proceed to FID. This is what I have for the environment, health and safety slide. Thank you.
Thank you, Ms.[Inaudible] . We will begin the Q&A session shortly. For participants with questions to pose, please use the raise hand function to ask your questions. We will then read out your name. Kindly introduce yourself before asking your question. Please take note that each participant may only ask two questions for the first round. Should you have further questions, you will have to use the raise hand function again to ask your questions. We will now begin the question and answer session. We do have one question that was sent in the chat. Okay. This was by Mr. Vincent from Principal Asset Management. Where was the higher OpEx for gas assets from?
Thank you for the question, Vincent. During business in relation to the quarter, is it?
Yes.
I mean, there were some repairs that we had to incur during the quarter relating to one or two of the gas vessels. That is the reason for the higher OpEx. It's one-off in nature.
Thank you, Azlan. Okay. Next, we have Encik Muhammad Nuur Ashman from AmInvestment Bank Berhad. Please proceed. Please go ahead, Ashman.
Thanks. Hi, Azlan, and hi, Captain. My first question is on the dividends. You announced the 36% [Inaudible] dividend, that 4% increase. I was wondering whether is that a safe expectation moving forward, or is that a one-off for this year?
We like to show that we are growing in terms of at least maintaining a stable amount of dividends. Hopefully that we can continue to pay good dividends to our shareholders.
Thanks, Raja Azlan. I'll take the hint. Secondly, is the status for FPSO Kikeh. I understand that vessel has encountered some problems and that your clients, PTTEP and PETRONAS, might be looking to replace that. Could you perhaps give us an update for that vessel?
Kikeh, there's no problem. It will still be under contract until 2028. It still is in a good condition.
All right. There's no expectation for the vessel to be replaced or whatsoever? Because there was some news report from upstream that indicated, like I said, your clients might be looking to replace the aging vessel. I was wondering whether there might be some plans to maybe repair the vessel or whatsoever.
The contract goes up to 2028. It is in good working order.
All right. Duly noted. Thank you.
Thank you. Mr. Ashman. Next, we have Mr. Kong Ho Meng from UOB Kay Hian. Go ahead.
Hi. Can you hear me?
Yes.
Yeah. A few questions. First, I want to just double-check in terms of the earlier question on the higher OpEx. For your gas side, you said that there are some one-off costs. May we know how much was the one-off cost? Can you help us to recap, in your gas segment, there was no income. It was also in the third quarter, and fourth quarter also it's barely any income. Whatever the one-off repairs that you do, would the LNG side which feed back to the steady state happen? Yeah.
Sorry, Kong. Can you repeat the question? Not very clear what exactly you're asking.
Oh, sorry. No. First of all, how much is the amount of the one-off OpEx that you've incurred for the gas side? Okay. Ignore my second question. Just answer this one first. Yeah, you can.
Yeah. I believe it's somewhere between slightly above $5 million, if I'm not mistaken.
Okay. $5 million. Also, can I just ask whether the so-called vessel OpEx, is it higher across the board? Not only for your gas, but also for your petroleum as well. If yes, how much has the OpEx even increased relative to, say, the year before?
Yeah. In terms of gas, really, it was because of some repairs and some, what do you call it, some higher bunker or port cost during the year. In the case of petroleum, the cost for the whole year Just give me a minute. The cost for the whole year for petroleum was actually lower. Lower by around 10% or so. Between 8%-10% compared to 2022.
When you say cost, you're referring to, let's say you convert them into a daily rate, right? The OpEx, daily OpEx is actually lower. Is it? Or are you referring to the absolute amount?
I'm talking about the absolute amount.
Okay.
Yep.
Okay. Can we know the spot and the term mix for the individual, the
I think for the petroleum side, as a whole, it's about 88% term and 12% spot. Whereas for the gas side is closer to 80% term and 20% spot.
For the gas side. Oh, gas is it? Okay.
Yeah.
Individually, like VLCC, different mix if you have.
If you look at the VLCC and the Aframax, it's roughly about 82% also term. The balance of 18% is spot. Then the shuttle tanker is 100% on term.
Okay. One more question from me, in terms of the QatarEnergy, their new LNG ship demand. I'm pretty sure that you are interested to bid for those, but within the pool of the so-called second base of the energy vessels, are you able to bid for the ones that are given to Nakilat, or Nakilat's one is totally theirs, and there's no room for you to bid for those? I think there's about 25 or so. Yeah.
Yeah. So far, we are not aware of any opportunity to bid for Nakilat's portion. We understand that they've taken a huge chunk of the order.
We're not aware that they want to offer out.
Okay. The non-Nakilat ones is still available for you to bid, whether it's on your own or whether it's a consortium, right?
Yeah. They have gone to market to pick bidders.
Okay. All right.
Thank you, Kong. Next, we have Mr. Raymond Yap from CGS-CIMB. Please go ahead, Mr. Raymond.
Yes. Thank you very much. Sorry, I was trying to find my unmute button. I think the question I have is on the LNG side again. The profit before tax in the third quarter was $73 million, but in the fourth quarter it fell to $52 million. The $5 million repair cost doesn't seem to make up the difference. Actually, revenues were flat quarter-on-quarter. Just trying to understand what's happening there.
Yeah. You're talking about the fourth quarter, right?
Yeah. Fourth quarter versus the third quarter. Third quarter was profit of $73 million, and in the fourth quarter it was profit of $52 million. That's a decline of $20 over million.
Yep. There was higher bunker costs that we incurred during the fourth quarter, Raymond. The bunker costs were one of the contributors. The port and voyage costs also were one of the contributors in addition to those repair costs.
Okay. Typically, these voyage costs, they are paid by PETRONAS?
Yeah. Because of the repairs and because of the assets going off-hire, we had to incur.
Right. Okay. Are these issues with the two energy carriers, are these issues of concern? Are they because the vessels are very old and there's some unexpected breakdown?
No. It was not relating to the older asset. It was relating to one of the assets which are not so old. It was not for the old asset, Raymond.
Okay. If it's not old, then why did it break down?
No, it didn't break down. There were some issues on board, which we had to deal with, and it went off-hire. It is a one-off situation.
Okay. Mm-hmm. Okay.
Thank you, Raymond.
Yeah. Okay, sure. Thanks.
Oh, sorry. Go ahead. You wanted to ask a question. Go ahead. Sorry about that.
I just wanted to ask about the FPSO Mero 3 construction revenue and profit for the quarter.
I don't have it with me, Raymond. Overall for the year, the construction profit that was recognized is comparable to the previous year as a whole for the year.
Okay. Sure. Okay. Thank you.
Thank you, Raymond.
Next, we have a question from Ben Shane. Go ahead, Ben, from Macquarie.
Hi. Good evening. Thanks for the time. My first question is just around your tanker segment. There's definitely been a lot of disruption around the shipping lanes. Just wondering whether operationally, there's any opportunity for you to lock in some of the elevated rates now. I know a lot of your tankers are already on time charter, but are you able to lock in and capture some of the existing rates, elevated rates for the full year going forward into 2024? Or should we expect it to fall off quite sharply at some point this financial year?
Maybe I can ask my boss to answer this question. Rajalingam, can you answer the question?
Thank you, Raja Azlan. That was Ben, is it?
Yes, it is.
Hi. How are you doing?
I'm well.
Okay. Yeah. Definitely, strategically, our team are trying to lock in as the rates gets elevated. At the same time, we also want to lock it in with clients which has got strategic partnership with us, premium clients, and not just go in into anybody who we can lock in with. There is a strategic focus in terms of those there. When Raja Azlan mentioned just now in terms of the term and spot for the petroleum sector, it should already give you an indication that the portfolio mix in terms of term and spot is getting much better for that segment, which is similar to the gas vessels.
Okay. Yeah, I just want to make sure, whether some of these are time charters locked in, like let's say last year, they expire this year. Whether you're able to lock them up for additional contracts this year, just given a good rate environment. They're locked up from last year, whether potentially you can miss this opportunity. That's where I'm coming from.
Yeah. Every year we have opportunity in terms of vessels coming off charter, opportunity for us to lock on. This is on an annual basis. Sometimes the team looks at it and say, "Yeah, okay, I see a higher forecast in the next quarter. I'm just going to wait it out and then catch on that higher forecasted rate." It's a combination of both, Ben.
Okay.
That's where the commercial sensitivity is coming. As you can see, the numbers proves itself. I'm sure that you do comparable comparators to our competitors as well. Quite decent.
Thanks for that. My second question is just around your bid book. Remind us what's the sort of funnel you're working with this year, what do you think is a reasonable conversion rate for new projects?
You want me to take that, Raja Azlan?
Yes, please go ahead. Yeah.
Yeah. Okay. This, you're talking about prospecting and then what's our forecast in terms of conversion rates, is it?
Yes, please.
Yeah. Okay. All right. Across all our segments, we do prospecting. I won't look at it from a conversion rate. I would look at it in terms of what's the value return coming in from those, what do you call, prospects. As you know, we're very diligent and very disciplined in terms of new CapExs, because we want to maintain our financial ratings and outlook, and also position only for strategic clients like PETRONAS, clients like the other big majors, we have briefed you as far as the portfolio is concerned. We don't have a specific conversion rate per se, but we have a target in terms of a maximum CapEx headroom that we do. We are prospecting. Some of you asked a question just now in terms of Nakilat and other tenders, et cetera. We are in bid processes, and the timelines are client-denominated.
Put any numbers to either the prospects or the CapEx target. Just want to clarify that for this year.
Raja Azlan, are we at liberty to reveal?
Yeah. If you talk about actual CapEx spend, it will be in line with what we have seen over the past one to two years now.
Okay, thanks. I'll use that.
Thank you, Ben. Next, we have a question from the chat. This is from Ting Ken Hhin from AIA. Is MISC looking to take on new FPSO projects? That's the first question. The second question is a bit long. Should I read it? MHB has incurred heavy provisions in the past. How can this issue be rectified and moving forward to address new contracts? Is MISC looking to dispose MHB from a strategic perspective? You want to take those questions, Cap?
Okay, fine. No issues.
First question. Yeah.
First one. What was the first one again?
FPSO, are we prospecting for any FPSO projects?
As far as prospecting, yes. We can't reveal in terms of what's the size, geography or clients at this stage. If I go back four or five quarters ago, most of you asked me whether we have confidence in delivering the Mero 3 back to baseline schedule. Today, our team have proven. Just trust us, we know what we're doing. Event-driven matters cause that six months delay. She's back on track, and she has sailed. I also see there's a question in terms of saying Mero 3 was supposed to sail on 18 February, and then it sailed out on 24. It's weather-related at site. Where we sail out the asset from the berth to the anchorage and then take over from the anchorage, we always must do it safely. That's the reason.
Yes, we are prospecting for FPSOs, we want to be very clear that in our prospecting, we want to prospect with partners already identified. Our balance sheet, we want to maintain our balance sheet strength and quality. Any bidding will be with partners, and that's what our team is doing. The rest is depending on client's timeline and how value-adding those are. The second one?
Second one was about do we have intention to dispose of MHB? I can read the question. MHB has incurred heavy provisions in the past. How can this issue be rectified moving forward to address the new contracts? Is MISC looking to dispose MHB from a strategic perspective?
MHB is delivering, what do you call, projects and those contracts which has been taken. These are historical contracts that they are delivering. As far as project delivery, we can do better in project delivery. That's the focus. MISC's role is to assist MHB in ensuring that these projects are delivered on time, on cost, and with the quality required. We have no intention to do anything else with MHB. There are good quality order books in MHB, and MISC is assisting MHB in terms of ensuring those order books are delivered on time, on cost, at the quality which is required by the client. Last weekend, I was in MHB. On time sail out of the Jerudong CPP.
It was very interesting that the team was talking about how good teamwork and assisting and supporting each other can make this delivery happen. We started the year in MHB, this year, on a fantastic track. On time, on quality, and at the FIDs that we think that we will be able to manage.
Is that clear? We have no intention of divesting our interest in MHB.
Thank you, Cap. Next from chat is from Kong Ho Meng. Question reads, "FPSO Mero 3 sailed away was meant to be on the in effect." Weather occurrence. It continues with, all this within allowable timeframe or should we expect penalty extra cost? As we said, it was due to weather related and there's sufficient buffer to catch up with. Next question is from Bin [inaudible]. Quarter 4 2023 term to spot mix for various vessel class, which your vessel design generally. There is a question from Kong Ho Meng wants to Go ahead, Kong Ho Meng.
Oh, hi. A question on CapEx that I typed there. In your sustainability report you mentioned 38% is going to be allocated for green. I'm just wondering, we all know that new build cost has gone up a lot quoted by the yards. Moving forward, should we still expect the $1 billion of CapEx per year or it's going to be a higher number?
Those numbers that you mentioned just now, Ho Meng-
Yeah.
More based on the next five years plan. Right? We will invest based on projects that can provide the returns that make sense. If those projects can provide good returns, yes, we will deploy capital to those projects. For now, as I mentioned, it is expected that the CapEx spend for this year will more or less be in line with what we have seen in the previous one or two years.
Okay. Got it.
Thank you, Ho Meng. We have a question from Mr. Raymond Yap. CGS-CIMB. Go ahead, Raymond.
Hi. Thanks again. I wanted to check what is the final CapEx for Mero 3 and whether there were any local content penalties that you had to pay. If you roll that into the CapEx, what's the final number?
Yeah. The final number is based on what we have guided before. Those are with the requisite provisions for the local content penalty as you mentioned.
Okay. In essence, just to recap again, was it $2 billion?
Yeah, I think that's what we have mentioned before, right?
It's around $2 billion.
I think so.
Including all financing costs as well as, we call it, the provisions.
The asset was basically financed using your own internal cash balance.
Yeah.
If you exclude out the assumed financing cost from that, how much was the actual CapEx itself that you had to pay your suppliers?
We need to include financing cost because there is an opportunity cost relating to the cash that was deployed.
Of course, the technical CapEx would be lower once you exclude the other financing costs, the provisions, et cetera. Yeah?
Mm-hmm. Okay. Sure. Okay. Thank you.
Thank you, Raymond. There is a question in the chat from Ashman. Ashman, when can we expect legacy projects with high cost at MHB to end and return to black? We have got about three more or so of these legacy projects which we are still trying to complete. The recent project that we won, that will help us to move forward based on a better footing.
Raja Azlan, if I can add, MHB is another listed entity. They have already had their Bursa release, and they've already had their analyst briefing. What was said was what was said. In MHB, at the moment, the focus is to improve on our project delivery. The team is improving to bring it back on track. Reiterate again that as a shareholder and having some of the expertise related, we are assisting in the bringing it back into project delivery timeline. It's another listed entity. It's inappropriate for us to make statements on behalf of another listed entity. I hope we respect that.
Thank you, Raja . Next, we have a question from Ho Meng. Ho Meng, please go ahead.
Okay. Do you still own the chemical tanker because from what I read on the news, you have completely exited. Just to double-check.
Yeah, there's one more asset remaining, Ho Meng.
Okay. That will also be disposed of in the near term.
I believe that is under in charter. The in charter bit will expire soon. In the next one to two years.
Got it. The two LNGs for the Sri Damai and Sri Daya that we've listed, have they started already and are they on net income generation? How do we forecast the income for this year?
Far, we have completed the transaction for one of them. In the month of January, I believe, it was on charter for a portion of the month.
Is it a very strong income or is Yeah, because I still don't want to touch on this at the moment.
Sorry, what did you say again, please, Ho Meng?
Is it sizable in terms of the income or is it very negligible?
Yeah, it is negligible, Ho Meng. It's just one asset. It's not really contributing much at this juncture.
Okay. Maybe if you don't mind me asking, the status of Captain Rajalingam Subramaniam , whether is that something that you can get a renew charter in the near term?
Yeah. It is currently in the yard undergoing repairs. It's scheduled to be under repair work, I think, for the next five to six months now.
After the repair, would it be continuing under its existing contract or would it be an entirely new contract with a new tenderer and all? Yeah.
Yeah. We may deploy it to other parties for a short tenure.
Okay. Got it. Right.
I believe that was the last question. Captain Rajalingam, would you like to provide any closing remarks for our friends here?
Sure, Raja Azlan. Thank you to you and the team for coordinating this analyst briefing. Thank you to our colleagues from the analysts for joining us today. Thank you for the questions. I hope that we'll be able to clarify as best possible on the clarification. I hope you see that, as an entity, we, what do you call, want to do our best in terms of value-adding to our shareholders, stakeholders and clients. Also try to do our best in terms of dividend returns to our shareholders as well. We are in a good state. We are very disciplined and conservative in terms of our prospecting for any of our business segments. On MHB, we are supporting in terms of ensuring that we improve on our project delivery.
Our main aim is to do that, no other intentions, because it's a national strategic asset, and it is for a national enterprise in terms of what we do. That drives in terms of supporting MHB to achieve its delivery. It's another listed entity, so we can't say much on behalf of that listed entity, which has also got other shareholders. When you look at the new CapExes, we are very focused in terms of clients, types, geography, and also the decarbonization agenda in the industry and the pivot that we are talking about. There is many initiatives ongoing at the moment in terms of R&D, in terms of working with key clients like Petronas and the rest to support the agenda. This includes the National Energy Transition Roadmap and the decarbonization agenda in the industry. It's all hands on deck in terms of delivering that.
2024, this is going to be our focus in terms of maintaining our discipline in new investments, portfolio management, and also value returns to stakeholders, shareholders, clients, and returns to shareholders. That's going to be our focus. Thank you very much, everyone. I also understand that some of you have visited the Mero 3 in Yantai. Some of you have gone to our vessels in Bintulu. I am told that it was a good experience, and I'm very happy that our team is able to coordinate this for all of you. We look forward to inviting you and hosting you for other such projects and programs. Look forward to catch up in person when the possibility arises. Thank you very much.
Thank you. Thank you, Captain Rajalingam. This concludes today's conference call. On behalf of MISC Berhad, we'd like to thank you for your participation. The PDF version of our presentation slides have been sent to the attendees of today's call and will be made available on our corporate website. The sell-side analysts, kindly forward a copy of your published research report to the MISC Investor Relations team for our reference. Thank you once again, everyone.