MHB shares plunged heavily because of this factor!

<p>&nbsp;Shares in Malaysia Marine and Heavy Engineering Holdings Bhd (MHB) plummeted today (Wednesday) following a disappointing second quarter earnings report.</p><p><br /></p><p>MHB reported a net loss of RM388.7 million for the second quarter ending June 30, 2023, compared to a net profit of RM21.97 million a year earlier.</p><p><br /></p><p>The decrease follows the increase in the company's allocation costs for ongoing projects.</p><p><br /></p><p>At the time of writing, MHB shares plunged 17.39% or 10 sen to 47.5 sen, bringing a total market capitalization of RM768 million in the Bursa's afternoon trading session.</p><p><br /></p><p>However the group saw a two-fold jump in its revenue to RM1.06 billion from RM400.63 million a year ago, driven by higher revenue from the heavy engineering segment.</p><p><br /></p><p><br /></p><p>The segment recorded revenue of RM990.9 million from RM309.9 million for the same quarter previously, contributed by higher revenue from ongoing projects.</p><p><br /></p><p>Overall performance for the first six months as of June 30, MHB recorded a net loss of RM385.16 million compared to a net profit of RM25.69 million a year earlier.</p><p><br /></p><p>Meanwhile, revenue was reported to have increased 89.7% to RM1.55 billion from RM818.41 million previously.</p><p><br /></p><p>The group, which is controlled by Petroliam Nasional Bhd (Petronas) sees the heavy engineering segment will continue to face challenges in implementing ongoing projects to meet originally estimated margins.</p><p><br /></p><p>This is due to the effects of rising raw material prices and global supply chain disruptions.</p>