MISC BERHAD 84 INTEGRATED ANNUAL REPORT 2023 85 www.miscgroup.com BUSINESS REVIEW SECTION 7 Petroleum & Product Shipping Fleet Rejuvenation VLCC fleet rejuvenation • Took delivery of new dual-fuel vessels • Delivered two LNG dual-fuel VLCCs ( Eagle Vellore and Eagle Ventura), on long-term charters to Shell Tankers (Singapore) Private Limited, strengthening AET’s secured income. Delivery of the third LNG dual-fuel VLCC was in early 2024 Towards Decarbonisation Strategic agreements • Entered into partnership agreements supporting our investments in ultra-low to zero-emission vessels • Signed an MoU with PTLCL to explore a potential collaboration to deploy a future ultra-low emission Aframax, powered by green ammonia • Signed a collaboration agreement with WinGD to drive the development of engines for ammonia dual-fuel vessels Focus Area What We Did in 2023 KEY FOCUS AREAS AND RESULTS KEY ACHIEVEMENTS Revenue (RM million) 2023 2022 5,030.2 4,667.3 Operating Profit (RM million) 2023 2022 1,356.6 1,021.0 Vessel Utilisation 1 Newbuilds Delivered • Successfully delivered three LNG dual-fuel VLCCs, designed with modern technologies, meeting the IMO’s 2025 EEDI Phase III standards 2 Innovative Solutions • Signed a collaboration agreement with WinGD to drive the development of engines for ammonia dual-fuel vessels Milestones Awards and Recognitions Recognised 48 vessels for exceptional health and safety records. CSA Jones F. Devlin Safety Award Awarded 40 vessels, reflecting our continued dedication to environmental excellence. CSA Environmental Achievement Award 2023 >99% 2022 >99% Results Petroleum & Product Shipping NAVIGATING THE CHALLENGES IN 2023 OPEC+ Production Cuts Enhanced financial resilience • Strengthened secured income strategy • Fleet was less affected by the volatility as a large proportion of our vessels are on long-term charters Geopolitical Tensions Resulted in Heightened Security Risk Improved safety of crew and vessels • Avoided conflict zones • Conducted close monitoring of sanctions compliance • Safety of the crew and assets were prioritised High Interest Rate Environment Proactively managed loan portfolio • Strategically hedged loans at favourable rates to mitigate the impact of rising interest rates • Limited impact from rising interest rates Challenges Mitigation Action • Rejuvenation of the AET fleet with new and efficient tankers • Continue to strengthen AET’s lightering business in the US Gulf • Collaborations with partners to develop ultra-low to zero-emission vessels and other initiatives to decarbonise shipping operations • Continue to explore opportunities in the renewable energy segment carbon value chains and future fuels through collaborations and partnerships with our customers and industry partners MOVING FORWARD Results
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