KUALA LUMPUR (Aug 3): In the last three years, Yinson Holdings Bhd (KL:YINSON) focused on delivering three of its latest floating production storage offloading (FPSO) vessels. Two are coming online this year and another next year, marking the end of its billion-dollar capital expenditure (capex) cycle that will lift its fleet size to nine vessels.
Contractual revenue from the segment has nearly doubled from just over US$10 billion (RM44.92 billion) in 2020, even as total borrowings ballooned above RM16 billion.
Yet, Yinson is already “aggressively” bidding for more of these capex-heavy projects, says group chief executive officer Lim Chern Yuan.
In an exclusive interview with The Edge, Lim talks about how the FPSO market is even hotter than three years ago, and shares Yinson’s long-term view of the renewable energy and green technology business. (The group is seeding electric vehicle leasing ventures, and operates more than 400 EV charging points in the country.)
He also explains the rationale of Yinson’s plans to unlock the value of its FPSO business, first announced in 2022, while addressing concerns about future capital requirements when it secures another vessel project.
“Do we really need to do a transaction [to unlock value]? The answer is no...but is it the right time to look for a strategic investor? Yes, we would like to be in a position to look for growth partners,” says Lim.
In the interview, Lim also touches on investors’ view on Yinson, including its high leverage, and the continued pursuit for growth when it could choose to just enjoy the returns from years of expansion. He also shares his thoughts on the energy landscape, and his approach to debt and growing the business for the long haul.
To know what else Lim has to say, and what shareholders and other stakeholders can expect from Yinson going forward, pick up a copy of the Aug 5, 2024 issue of The Edge Malaysia weekly at newsstands.
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