This article first appeared in The Edge Financial Daily, on October 7, 2015.

KUALA LUMPUR: Boilermech Holdings Bhd expects to see flat bottom-line growth in its financial year ending March 31, 2016 (FY16), amid current economic uncertainties.

“Since the [economic] downturn is affecting everybody today, we are aiming to achieve what we achieved last year,” the group’s managing director Leong Yew Cheong told a press conference yesterday.

Leong declined to elaborate, but conceded the weakening ringgit is pressuring the group’s margin as its business involves importing machines from Germany.

For FY15, Boilermech registered a net profit of RM39.2 million, up 26% from the RM31 million seen in FY14; revenue also rose 14.8% to RM277.9 million from RM242 million in FY14.

Leong said the group has an order book of about RM300 million, which would keep it busy for the next 18 months. It is also tendering for jobs valued up to RM30 million.

Boilermech signed a 15-year partnership agreement yesterday with Australia-based Commonwealth Scientific and Industrial Research Organisation (Csiro), together with a memorandum of understanding (MoU) with Jasa Aman Engineering Sdn Bhd.

The agreement stipulates Csiro giving Boilermech the exclusive rights to commercialise Csiro’s patented technology for palm oil mills to enhance oil extraction efficiency.

Leong said the group hopes the partnership would improve Boilermech’s FY16 revenue, so as to be on par with FY15’s financial performances.

“Our first quarter was not that impressive, and revenue for first half of FY16, we only did about 40% of the same period last year. So, we expect this agreement with Csiro would help boost our sales in the remaining quarters of FY16,” Leong explained.

Boilermech’s net profit in the first quarter ended June 30, 2015 (1QFY16), came in 22.35% lower at RM7.82 million, from RM10.08 million a year ago. Revenue was at RM60.02 million, down 19% year-on-year from RM74.14 million in 1QFY15.

Leong said Csiro’s technology is a relatively new one in the market that holds much potential due to its ability to recover trapped oil during the settling process.

“We hope to incorporate this technology in existing and all future palm oil mills in Malaysia and other palm-producing countries, and look forward to the good acceptance of this advanced technology,” Leong said.

On the MoU, which was inked between Boilermech’s wholly-owned subsidiary Boilermech Cleantech Sdn Bhd and Jasa Aman, Leong said it will potentially see Boilermech Cleantech be appointed the official, exclusive agent to market, sell, install and service Prime brand’s steam turbine generator for industrial power generation projects in Asia.

“As the official agent for the Prime steam turbine generators, Boilermech will be able to offer a one-stop solution for electrical power generations. We are currently working on a 10-year agreement through this partnership,” he said.

Boilermech is mainly involved in the designing, manufacturing and commissioning of biomass boilers, primarily for the palm oil milling industry. It also provides engineering solutions for biomass boilers.

Boilermech’s share price gained one sen or 0.91% to close at RM1.11 yesterday, giving it a market capitalisation of RM572.76 million.