(Extracted from Annual Report 2018)
On behalf of KKB's Board of Directors (the Board), I would like to record my utmost appreciation to our Management Team and all the staff for their hard work in delivering the commendable operating performance and financial results for the financial year ended 31 December 2018 (FYE 2018) as set out in this Annual Report.
The current financial year was fraught with challenges and intense competition on the back of volatility of crude oil prices and continued uncertainty of the global macro-economy. Despite the challenges, I am pleased to report that the Group successfully sailed through these tough conditions and remained in a strong financial position, delivering solid results for the year under review.
KKB has always upheld the principles of transparency and accountability. The Group commitment to meeting the highest standards of Corporate Governance remains strong. Leveraging on our high level of Corporate Governance and continuous enhancement of quality and efficiency, we achieved commendable results in FYE 2018.
Overall, the Group delivered strong financial results for the year under review, demonstrating the effectiveness of our long standing strategy to strengthen and grow our core business in both the engineering and manufacturing activities towards a sustainable growth. We achieved good profit growth despite a number of headwinds.
With the Companys sound financial position, our Board is pleased to recommend for shareholder's approval at the forthcoming Forty-Third (43rd) Annual General Meeting a first and final single tier dividend of four (4) sen per ordinary share for the financial year ended 31 December 2018.
Our Group remains committed to focusing on our core competencies and prudently managing operating costs and business risks to stay competitive. We believe our capabilities and strong track record will help us ride out any challenging times ahead and respond to any potential upswing in demand.
KKB is developing an increasingly diverse portfolio of operations that will reduce our dependence on any single product or sector. Our presence in the Major Onshore fabrication for the Oil and Gas facilities will facilitate the Group to diversify our core business in Structural Steel Fabrication engineering for the Oil and Gas Sectors to complement our traditional engineering and manufacturing business activities.
During the year under review, we are pleased to have secured three (3) new contracts related to the Major Onshore fabrication for the Oil and Gas sectors, total worth approximately RM300.0 million via OceanMight Sdn Bhd, KKB's 60.81% subsidiary company. During the year, one of these projects i.e the Engineering, Procurement, Construction, Installation and Commissioning (EPCIC) of Wellhead Platforms for D28 Phase 1 Project under Petronas Carigali Sdn Bhd was successfully completed in just seven (7) months.
The Group is well positioned and has exciting prospects going forward. We have developed a strong, high performance culture with a committed workforce and absolute integrity in our operating procedures. The long term prospects for the Group are encouraging and I remain confident that we will continue to deliver value for our customers, employees, shareholders and other stakeholders in the coming years.
We continue to look at modern technology and talent to support and grow our core competencies in Structural Steel Fabrication engineering for the Oil and Gas Sectors to complement our traditional engineering and manufacturing business activities.
We are similarly clear on our financial objectives. While our business operations continue to be under margin pressure, we are focused on growing both our traditional engineering and manufacturing business activities and major onshore fabrication for the Oil and Gas facilities. By investing in modern technology and equipments for our plant and continuing to use and improve the efficiencies of our existing assets, we expect that demand for our fabricated and manufactured products within both the Engineering and Manufacturing sectors will remain strong in the face of increased competition and downward pressure on pricing.
I would like to express my sincere appreciation to our Board, for their continued support and advice. On behalf of the Board, I would like to express my utmost and sincere thanks to Dato Anwarrudin Bin Ahamad Osman, our Non-Independent Non Executive Director, who resigned from the Board on 1 June 2018. His past contribution to the Group over many years has been invaluable and we wish him all the best for the future.
We are well positioned for growth in 2019 and beyond. To achieve this, we need the passion and commitment of our employees, whose collective competence, loyalty and resilience have put the Group in good stead. Once again, my heartfelt thanks to the management and staff across the Group who are critical to our success. With their continued commitment and professionalism we can achieve our ambitious plans.
Last but not least, my utmost appreciation goes to our shareholders, customers, suppliers, bankers, business associates, advisers and relevant authorities whom we have been dealing with over the years for their unwavering support and trust in KKB. We look forward to your steadfast support as we continue our path of sustainable growth and value creation.
Thank you.DATO KHO KAK BENG