Oiltek International (HQU) H1 2026 earnings summary

Executive summary

• H1 revenue was RM99.24m, down 1.6% YoY; profit after tax was RM13.16m, down 6.9%, with profitability affected by project mix and execution timing.

• The order book stood at RM258.7m for fulfilment over 18–24 months; cash was RM95.1m with no bank borrowings.

Financial highlights

• Gross profit fell 20.7% to RM25.72m; gross margin contracted 6.3 percentage points to 25.9%, mainly on lower-margin refinery contributions.

• Profit before tax fell 8.0% to RM17.63m; tax expense fell 11.0% to RM4.48m and profit after tax fell 6.9% to RM13.16m.

• Other gains/(losses) swung from a RM6.21m net loss to a RM0.43m net gain, primarily from unrealised FX gains as the US dollar strengthened against the ringgit.

• Other income declined 47.7% to RM1.07m, mainly due to lower interest rates; administrative and other expenses eased 0.4% to RM9.58m.

Outlook and guidance

• The RM258.7m order book comprises unfulfilled signed contracts, confirmed variation orders and letters of award, with fulfilment expected over 18–24 months, barring unforeseen circumstances.

• Outlook remained cautiously positive; plans include pursuing new orders and commercially viable joint ventures aligned with strategic objectives.

• Refinery engineering prospects are supported by expected fats, oils and vegetable-oil market growth; renewable energy opportunities include biodiesel, HVO and SAF-related projects.