Labuan Shipyard On Right Track For Continued Business Growth

By Jailani Hasan LABUAN (Malaysia), Dec 28 (Bernama) -- Labuan Shipyard Engineering Sdn Bhd (LSE) has recorded a solid year of business operation improvement and growth in 2012, and is now moving into another phase of its transformation plan which is expected to seal projects worth hundreds of millions of ringgit next year. LSE's turnaround strategy focused on improving customer proposition through quality, service, safety and value, while continuing to deliver truly better value in order to build customer trust in its capability, particularly in projects completion, by putting in more investment, thus seeing additional expenditure in the interest of clients’ needs, strict requirements and procedures. Its chief executive officer Mohd Azman Nasir, in an exclusive interview with Bernama, said LSE turnaround remained on track and the business is now moving into another phase in which it would focus on ‘Delivering Consistently Well’ by embedding the positive culture, improving customer service, continuing the commitment to value and vice versa. “We will continue to develop and improve our facilities through ongoing investment in our yard and this is to support major builder customers to ensure a full-service offering is provided," he said. Azman said the company is well positioned for continued business growth and the strategic focus remained in five growth drivers: service, category expansion, network expansion, business opportunities, and achieving lower cost of doing business to underpin the provision of more value to customers. Being one of the largest yard operators in the region, LSE is determined to be the regional champion in the oil and gas (O&G) and fabrication driven by its capabilities and facilities. The shipyard recorded tremendous achievement after being awarded mega projects and had successfully completed the projects on schedule. "LSE has emerged in good shape from one of the most volatile and challenging times in our company’s history, and, I believe, we have good reason to be confident about the future. "We have been very focused on ensuring that the company is in a sound financial position and well-placed to prosper from a return to a strong economy, which was the impetus for the 2012 equity raising," Azman said. Two projects -- fabrication of two single point mooring buoys and fabrication of pipeline end manifold for Sabah O&G Terminal or SOGT in Kimanis had been completed ahead of schedule. LSE had also secured RM100 million (US$32.66 million) contract to build 77m diesel electric propulsion platform supply vessel, specially designed to support O&G activities, and the first in Malaysia to use updated and advanced technology. Azman said efforts were also focused on improving safety and delivering team programmes that support and enhance the business strategy and underlying culture. “The safety of our team members, contractors and visitors received a renewed focus this year,” he said. Azman said LSE has undergone significant change throughout the year with a focus on renewing its business activities. “All components of the business were reviewed and changes implemented. A crucial element of the renewal was to invite and regain players back into our path. As LSE moves from the renewal to the growth phase of its strategic plan, a number of challenges continue to exist. “Throughout 2012, action was taken at our sites to improve the efficiency of our services and operation, to develop our people's capability, support the local communities, grow the business through expansion plans and reduce our environmental footprint. At the heart of our sustainability strategy is the safety and wellbeing of our employees. “A focus for the year was on consolidating and improving upon the safety performance achieved in the previous year. We take seriously our commitment to upholding the highest standards of conduct within our operations. "That includes efforts to always do business the right way for our customers, clients, shareholders, and in the communities we serve to provide leaders with the knowledge and tools they need to make sound decisions, and to help our employees clearly understand the values and standards that guide our business every day,” he said. “One way we build and protect our culture is by promoting our company’s sustainability priorities. We continue to make progress as we work to serve our customers, clients, and communities, and generate returns for our shareholders. "We understand that success is only meaningful when it is achieved the right way, with the right values. Our commitment to this principle is the key to sustaining public trust and confidence in our business, and the key to our long-term success," he added. Meanwhile, Azman was optimistic that LSE is well positioned to benefit from improving economic conditions and market demand, particularly in the O&G sector as well as in fabrication and ship repair. “This year was marked by a strong recovery with good operation momentum across a number of areas due to sustained project activity, particularly in oil and gas, contract successes, pleasing services growth, and increasing industry diversification." Over the years, LSE continued to strengthen its capabilities, including the roll-out of a full customer relationship management capability. The businesses remained focused on attracting, retaining and developing quality employees, while labour retention challenges increased with the upturn of business activity, especially in the resource sector. Azman said when it was established, LSE adopted the objective of delivering satisfactory returns for its shareholders. Over the years, the responsibilities of business -- particularly for an organisation such as LSE -- has changed significantly. “Financial success is no longer the only measure that matters. Increasingly, companies are assessed on how they manage a wide range of factors that contribute to a strong bottom line," he said. In the context of its commitment for sustainable outcome, he said LSE has nominated several key areas of focus that would contribute towards delivering satisfactory returns to its shareholders. These include giving priority on the importance of people, community investment, reducing overall environmental footprint and a strong economic contribution. “This approach helps provide a structure under which consistent sustainability outcomes can be delivered across LSE, in which a very wide and diverse range of sustainability activities are pursued by the various businesses. "A strong business sector and a strong economy go hand in hand. LSE seeks to maximise its contribution to the economy through long-term growth that increases overall economic activity and its capacity to generate additional direct and indirect employment. “Through the taxes it pays, the company plays its part in enabling governments to invest in better development-focused infrastructure and social support networks. “By providing dividends and other investment returns to the company’s shareholders, LSE contributes to individual wealth generation and a more prosperous general community, and this is part of our social responsibility,” he said. -- BERNAMA