INTEGRATED ANNUAL REPORT 2024 16 17 SECTION 3: KEY MESSAGES www.miscgroup.com MISC BERHAD Chairman’s Message NAVIGATING A COMPLEX OPERATING LANDSCAPE The macroeconomic and geopolitical environment in 2024 remained uncertain, presenting both risks and opportunities. However, with our strategic focus on advancing MISC’s low-carbon future while strengthening our core businesses, we continued to explore growth opportunities to drive meaningful progress. Geopolitical tensions disrupted trade flows, causing increased tonne-mile demand and operational risks. Sanctions on Russian oil and gas have reshaped global trade, resulting in longer voyage distances, while instability in the Middle East has forced vessels to reroute around the Cape of Good Hope. Despite these headwinds, MISC remained agile, ensuring operational stability, safeguarding our crew and vessels and delivering reliable service to our clients. The LNG sector faced challenges due to liquefaction project delays and a high number of new LNGC deliveries, which led to weakening charter rates, particularly for steam vessels. In response, we are rejuvenating our LNGC fleet with modern and lower-carbon emissions vessels secured under long-term contracts, strengthening revenue stability and ensuring consistent cash flow in the future. Additionally, with heightened regulatory requirements from the International Maritime Organization (IMO) and the European Union (EU), we have strengthened our decarbonisation efforts. This involves upgrading our fleet with LNG dual-fuel and ammonia-ready vessels and exploring other future fuels as well as abatement technologies to achieve a targeted 50% reduction in GHG emissions by 2030. We continued embedding our Internal Carbon Pricing (ICP) Framework into our project assessments and investment decisions, ensuring readiness for the anticipated global carbon taxes. Chairman’s Message RE-ENERGISED FOCUS, RESILIENT ACHIEVEMENTS Amidst a rapidly changing environment, MISC has strategically refined its focus while building a foundation for sustainable growth. In 2024, we moved forward with MISC 2030 Ambition by prioritising three key pillars: Resilient Core, Profitable New Energy Business and Decarbonisation. Through targeted emphasis on these areas, we have achieved balanced progress in fortifying our core operations, venturing into the new energy sector and adhering to evolving regulatory requirements. In 2024, we accomplished a significant milestone following the successful delivery of FPSO Marechal Duque de Caxias after it achieved its first oil on 30 October. Being our largest investment to date, it demonstrates our ability to manage complex projects despite pandemic-related disruptions. Our Marine & Heavy Engineering segment also recorded a turnaround, driven by improved project delivery and financial performance, culminating in the delivery of key projects, such as the Jerun Development and Rosmari-Marjoram Gas projects. In future fuel innovations, MISC has made significant advancements in ammonia dual-fuel technology. A milestone this year was AET’s groundbreaking long-term charter agreement with PETCO Trading Labuan Company Ltd. (PTLCL) for the deployment of the world’s first two ammonia dual-fuel Aframaxes. As part of the PETRONAS Group’s Gas and Maritime division, we will continue to explore new value-creation opportunities and synergies by aligning the core aspects of our business. Strengthening our partnership with PETRONAS, we have signed Time Charter Parties (TCPs) for two new LNGCs, each secured under firm 15-year contracts. DELIVERING CONSISTENT RETURNS Amidst prevailing market uncertainties, MISC remained financially resilient. The Group recorded a profit before tax of RM1,283.5 million, lower than in 2023 due to headwinds in the Gas Assets & Solutions and Offshore segments. Despite these challenges, the Group’s cash flow remained strong. Accordingly, the Board declared a dividend of 36 sen per share, reflecting our ability to deliver sustainable returns consistently. In 2024, we accomplished a significant milestone with the FPSO Marechal Duque de Caxias achieving first oil on 30 October. Dear Stakeholders, 2024 was a defining chapter in MISC’s journey, a year marked by both challenges and strategic milestones that reinforced our commitment to long-term value creation. We navigated a dynamic and evolving landscape influenced by geopolitical tensions, economic challenges, regulatory demands and the ongoing energy transition. MISC responded with a re-energised strategic focus, operational agility and a steadfast approach to decarbonisation. Through these efforts, we charted the way forward and continued to create value for stakeholders while building a more resilient and future-ready MISC.
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