MMC Corp Bhd’s first-quarter earnings were pulled down by lower contributions from the energy, engineering and construction businesses.

In a filing with Bursa Malaysia on Tuesday, the company said earnings fell 46.4% year-on-year to RM51.34mil in the quarter to March 31, 2016, as revenue dropped 52.8% to RM936.27mil.

The biggest blow to revenue was the listing of Malakoff Corp Bhd, which left MMC Corp with a lower effective interest of 37.6% in the water and power producer compared with 51% previously.

The conversion of Malakoff into an associate company hit the energy and utilities segment’s earnings before interest, tax, depreciation and amortisation (Ebitda), which shrank to RM41mil from RM671mil previously.

MMC’s engineering and construction segment also did not fare well. Its Ebitda dropped 60% to RM29mil in the quarter under review due partly to less amount of underground works performed for the Klang Valley Mass Rapid Transit Sungai Buloh-Kajang line (construction is drawing gradually to an end with 86% progress as at reporting date).

Another factor was losses from 39.25%-owned associate Zelan Bhd, which were mainly attributed to effects from discounted receivables and unrealised loss on foreign exchange concerning the project to build Meena Plaza in Abu Dhabi. Zelan had terminated the contract due to alleged non-payment issue.

The bright spot for MMC was the ports and logistics segment, which grew its Ebitda by 65% to RM282mil. This was due mainly to the effect from the consolidation of NCB Holdings Bhd’s results (MMC Corp’s unit MMC Port Holdings had taken the Northport operator private following a mandatory general offer) as well as higher throughput handled coupled with lower operational costs incurred at Port of Tanjung Pelepas following a cost efficiency and productivity programme.

MMC Corp shares gained 1 sen to close at RM2.12 on Tuesday, with 148,700 shares traded.

Source: Hellenic Shipping News