6
GROUP CEO’S STATEMENT
the Middle East in areas like subsea stabilisation and
ROV. Another important milestone is the Quad project
with a major oil company operating in the North Sea.
We managed to complete an integrated engineering
project from design all the way to fabrication and
installation. This has managed to save our customer
sufficient costs while improving field efficiency. Having
just relocated to a purpose built facility in Welshpool,
Perth, we look to improving operating synergies as
well as lower property costs. The market remains
challenging with much competition, several of our
major oil customers have written to ask to seek lower
prices. Our focus is to build a reputation as a strong
regional service provider, with our customer-focused
mindset differentiating us from larger international
competitors.
Overall, our Oilfield Engineering and Neptune Marine
businesses are making good progress in helping MTQ
Group to develop its presence as a specialist subsea
service provider of choice in its chosen markets. Our
strategy remains to develop a more comprehensive
range of services, both geographically and functionally,
so that our potential work scopes with our oil and
gas customers can increase. Our focus remains in
specialist engineering and subsea services, particularly
in the repair and maintenance phase of established
oilfield assets. With the immediate market environment
bearish, we continue to watch our costs.
ENGINE SYSTEMS – IMPROVING OUR
RETURN ON EQUITY
The growth in Engine Systems business continue to
be tepid in recent years. Negative business sentiment
affected this business with the general slowdown in
the domestic industrial sector leading to a reduction
in demand for its products and services. Following
several years where growth has proven elusive, we
took a decision to take a goodwill impairment charge
of S$0.9 million reflecting lower long term prospects.
We continue to seek growth opportunities in the
resource sector but we need to improve the return on
equity generated in this business.
PEOPLE AND SAFETY – KEY AREAS
It is tempting to infer that the challenge of finding
people will recede moving ahead as the industry
enters a downturn. Certainly, there have been
redundancies undertaken by oil and gas companies,
both in Singapore and elsewhere. However, such a
view would be short sighted. We will continue to train
and upgrade the capabilities of our work force, having
flexibility in cost structures help to alleviate the cost.
Hopefully, the current environment will enable us to
strengthen the technical competence of our teams.
Our overall numbers have decreased this past year.
Retaining and developing this pool of talent is still very
important for companies like MTQ.
Given that government measures to restrict the
growth of foreign workers in Singapore are set to
remain, the Group has to work harder at retaining
existing and attracting new employees. The Group
remains committed to a policy of sharing the rewards
with the workforce, so that interests are aligned across
stakeholders. We embrace re-employment and are
keen to enhance the working lives of our employees
where we can.
Our strategy in Bahrain remains to source local
candidates and train them at our facility while
augmenting overall numbers by recruitment from
overseas for experienced and managerial positions.
Another year of experience has been chalked up
by our workforce, which augurs well. We have also
strengthened our leadership team with new members
from overseas and we continue to focus on finding
people with the right caliber. We continue to tap on
the Group resources while building the Bahrain team
for the future.
As we develop a stronger Group management team
for the future, aligning management with shareholder
interests for the long term becomes critical. Expertise
and experience is much prized within the industry,
especially for senior positions. Following shareholders’
approval for the MTQ Share Plan received in 2013, we
granted shares to senior management for the first
tranche in 2014. We have expanded our performance
