Nam Cheong profit surges 82.9% as shipbuilding resumes

Shipbuilding generated $21.95m in revenue after six years.

Nam Cheong’s net profit rose 82.9% year-on-year to $40.23m (RM164.4m) in the first half of 2026, whilst revenue increased 25.2% to $85.24m (RM348.3m).

Vessel chartering contributed $63.29m (RM258.6m) in revenue, down 7.1%, whilst shipbuilding generated $21.95m (RM89.7m), marking the segment’s first revenue in six years following the delivery of one vessel and progressive recognition of vessels under construction.

Gross profit fell 3% to $33.55m (RM137.1m), with overall gross margin narrowing to 39.4% from 50.8% a year earlier. The decline reflected the shift in revenue mix towards shipbuilding and lower chartering margins.

Chartering gross margin fell to 44.3% from 50.8% due to higher operating costs for vessels deployed in the Middle East and lower accommodation vessel utilisation. Overall vessel utilisation, however, improved to 65% from 58%.

As of 30 June, 25 of Nam Cheong’s 35 vessels were under long-term charters, representing 71% of its fleet and exceeding its 70% target. The company said the coverage provides a balance between recurring income and opportunities to capture gains from the spot market.

Offshore activity in Malaysia is also supporting demand for offshore support vessels, with spending rising across several operators.

PTTEP took a final investment decision in February on the Sirung and Chenda fields in Block SK405B offshore Sarawak, with production expected to reach about 15,000 barrels per day from 2028.

Shell also announced a final investment decision on the third phase of the Malikai deepwater field offshore Sabah, which is expected to increase the field’s output by 60%.

Beyond Malaysia, demand for offshore support vessels remains firm, with global marketed fleet utilisation projected to reach 77% in 2026 and exceed 79% in 2027.

Supply remains tight, with more than half of the global operational offshore support vessel fleet aged over 15 years as of May 2026.