KUALA LUMPUR (Aug 15): Boustead Heavy Industries Corp Bhd (KL:BHIC) announced that its 51%-owned joint venture, BHIC AeroServices Sdn Bhd (BHICAS), has secured a RM378 million contract to provide in-service support and performance for the Royal Malaysian Air Force's EC725 helicopters.

In a bourse filing, BHIC said that the Letter of Award (LOA), dated August 2, was issued by the Ministry of Defence, representing the government of Malaysia, to BHICAS.

The contract is for a period of five years, commencing from the date of acceptance and signing of the LOA by BHICAS, with a formal contract between the government of Malaysia and BHICAS to be finalised and executed at a later date.

BHICAS is jointly-owned by BHIC Defence Technologies Sdn Bhd (51%), Prestige Pillar Sdn Bhd (30%) and Airbus Helicopters Malaysia Sdn Bhd (19%). BHIC Defence Technologies is a wholly-owned subsidiary of BHIC.

BHIC said that the contract will positively contribute to its earnings for the 2024-2029 financial years.

BHIC, 64.99%-owned by the Armed Forces Fund Board (LTAT), reported a net loss of RM6.67 million for the first quarter of FY2024 (1QFY2024), following a net loss of RM6.5 million for the same period the previous year, due to higher operating costs and lower contributions from joint venture companies amid reduced customer demand.

However, quarterly revenue increased to RM19.15 million in 1QFY2024 from RM6.36 million previously, attributed to positive milestones achieved in submarine contracts.

Shares in BHIC closed unchanged at 48 sen on Thursday, giving the group a market capitalisation of RM270.85 million.