Enproserve Group Bhd, a specialist in plant maintenance and turnaround services, is significantly expanding its machinery and fleet capacity as it positions itself for robust growth in 2026 and 2027. This strategic build-up is driven by the anticipated large-scale plant turnaround at the Pengerang Integrated Petroleum Complex – a job that may be the largest of its kind in Malaysia – and the company’s expansion into new business segments, including mobile crane rental and facilities management.
Managing Director Azman Yusof stated that the company, which is en route to a listing on the ACE Market, is actively preparing to execute the Pengerang turnaround by 2027 at the latest.
“There will be substantial equipment and manpower requirements to stop the plant, open and inspect the equipment, undertake necessary repairs and safely restart operations,” Azman told StarBiz in a recent interview.
The company’s initial public offering (IPO) entails the issuance of 210 million new ordinary shares, targeted to raise RM50.4 million at an IPO price of 24 sen per share. Concurrently, Azman will offer for sale 105 million existing shares, raising an additional RM25.2 million and diluting his ownership from 100% to 70% post-listing.
Of the RM50.4 million to be raised from the public issue, RM23.68 million – or 47% – has been allocated for capital expenditure. This includes RM9.16 million for the acquisition of new machinery and equipment, RM9 million for lorries and a mobile crane, and RM5.5 million for the establishment of a dedicated crane depot.
The investment is intended to support both existing and future contracts without eroding profit margins, while simultaneously reducing reliance on third-party leasing.
“If you want to maintain strong margins in the oil and gas sector, you must own the assets required to deliver the work,” Azman added.
Between 2019 and 2023, Enproserve completed 14 contracts. It currently holds 33 active contracts, including six turnaround contracts that will run through to 2029. The majority are within its core plant maintenance and turnaround division. In addition, the group has secured five engineering, procurement, construction and commissioning (EPCC) contracts, two facilities management contracts, and seven crane rental contracts.
The company’s contracts are predominantly secured through long-term master service agreements based on unit-rate pricing, which ensures recurring revenue as specific work scopes are confirmed and executed.
To further strengthen its balance sheet, RM11.65 million or 23% of the IPO proceeds will be allocated to repay existing bank borrowings. This will reduce the group’s net gearing from 1.07 times to 0.50 times. Another RM10 million (20%) will be reserved for working capital, while RM5.03 million (10%) will cover listing-related expenses.
For the financial year ended 31 December 2024 (FY24), Enproserve recorded revenue of RM198.41 million and a net profit of RM20.22 million. Over the past three years, the company achieved a compound annual growth rate of 29.5% in revenue, driven largely by its plant maintenance and turnaround segment, which contributed RM164.95 million or 83% of total revenue.
Notably, revenue from related services such as equipment and vehicle rental, as well as manpower supply, more than doubled to RM11.5 million in FY24 from RM4.08 million in FY23. This segment now contributes nearly 6% of the group’s topline, bolstered by seven long-term rental contracts awarded by Petroliam Nasional Bhd (PETRONAS) in September 2023. These contracts span three years from 2023 to 2026, with an option for a two-year extension, and cover the provision of mobile cranes, forklifts, lorries and other lifting equipment for daily operations and scheduled turnarounds.
In response, Enproserve invested RM34.5 million to acquire 21 new mobile cranes, bringing its total fleet to 24 units. The IPO proceeds will further enable the company to expand its fleet and crane depot infrastructure to meet growing demand.
The EPCC segment contributed RM10.98 million, or 5.5% of revenue, while facilities management services brought in RM11.08 million or 5.6%.
Revenue from the company’s top five customers totalled RM195.03 million, representing 98.3% of FY24 revenue. Of this, Pengerang Refining and Petrochemical – a joint venture between PETRONAS and Saudi Aramco – contributed 47.6%, while PETRONAS Group accounted for 43.9%, primarily through plant maintenance, turnaround, and engineering services.
“We are currently dependent on PETRONAS. But as a local oil and gas service provider, it is a reality we have to embrace. This listing provides a platform for us to establish our own brand identity,” said Azman.
Enproserve also secured 4.1% of FY24 revenue from Malaysia’s Public Works Department via facilities management contracts for government buildings.
The IPO application closes on 8 July, with a tentative listing date set for 18 July.
-The Star
