We turned T7 Global from an O & G company into a total industrial solution provider . I think it ’ s a question of perspective . O & G companies are still there , they are relying on oil prices , but for T7 Global , besides O & G or energy , as we call it now , we have gone into aerospace and defence and construction .”

Speaking to The Malaysian Reserve ( TMR ), T7 Global chairman Datuk Seri Dr Nik Norzrul Thani shed light on the company ’ s corporate plans and outlook after building a sizable work order book and reputation in the oil and gas ( O & G ) business since 1990 .

T7 Global ’ s net profit jumped 33.66 per cent to RM1.35 million in the second quarter ended June 30 , 2021 ( 2Q21 ), from RM1.01 million a year earlier , on higher contribution from its energy division .

The company ’ s revenue for the quarter increased 49 per cent to RM54.19 million from RM36.39 million a year ago due to the recovery in O & G activities in the region having a positive impact on its ongoing projects .

Below are some of the key talking points from the online interview .

Can you share how the company started and manage to go from red to black ? Tan Sri Tan Kean Soon and I took over the company in 2015 and undertook a transformation programme . It was a tough time for us as an O & G company as we had a lot of governance issues we had to clean up , and legacy issues needed to be cleared .

Crude oil prices had fallen , and it was a bit of a shock . But we ’ re lucky we came in new and were able to see things differently . So , we focused on diversification from O & G into a business that was not affected by the oil price . We also started to focus on maintenance as we ’ re doing now — relying on 5-10 years contracts .

We turned T7 Global from an O & G company into a total industrial solution provider . I think it ’ s a question of perspective . O & G companies are still there , they are relying on oil prices , but for T7 Global , besides O & G or energy , as we call it now , we have gone into aerospace and defence and construction .

It is a more specialised construction and more high industrial-based construction work . We want to be known as a high-value industrial solution provider . We had a lot of highly skilled workers , and thanks to the downturn of O & G at the time , we were able to reskill them to go into aerospace .

We trained and invested in people . Investment in human capital is essential for us . We were pretty lucky when transforming the company . We had a low gearing level that would impact our cash flow . We got some loans because we have a big project — a mobile offshore production unit ( MOPU ) contract worth RM1 billion .

That is our primary project , and we will start to see payment coming in next year onwards . Tan and I tell ourselves it ’ s not a sprint but a long game because we are here for the long term .

Datuk Seri Dr Nik Norzrul Thani

We are blessed with our loyal shareholders . We started to give dividends in the last few years as we have turned around , but it wasn ’ t easy . Turn around sounds good , but it ’ s a lot of stress . But it makes us a better person .

What is your outlook for economic conditions and T7 Global ? We are bullish with businesses opening up , and consumer confidence remains good . As we are in an endemic environment , we have to be cautious , and at the same time , we need to restart . T7 Global is quite fortunate because we have order books .

We did not panic when Covid-19 hit as we were able to manage . But with Malaysia stepping up vaccine distribution , things will be at least as normal as possible under the circumstances . The 12th Malaysia Plan ( 12MP ) boosted businesses and foreign investment to come back again .

Moving forward , what is T7 Global ’ s plan ? T7 Global has an order book of about RM2 billion for the next 10 years . We are bidding for about RM3 billion worth of work contracts . It was fortunate when we were in aerospace . We had a lot of support from the government and a lot of accreditations .

In aerospace , accreditation is essential . We have to be accredited by Boeing and many other international bodies — we are on the verge of getting that . We have a high-value manufacturing facility in Serendah . We have staff trained .

We had a relationship with the Institusi Kemahiran MARA , where we took fresh graduates and sent them to Mexico to be trained by our partner to learn about AeroTech . However , when everything was ready to take off , Covid-19 hit .

We were lucky in the sense that we were not at full blast , but we had already spent . The management was good . They were able to manoeuvre , and there was a better “ treatment plan ”.

So , despite orders down since the

whole aerospace industry was in a bit of a shock , we were able to transform and survive by going on aeroplanes and other metal treatment manufacturing cars . With things picking up , we see fresh orders coming , and we are ready .

Our fully automated metal surface treatment plant is among the most advanced in Southeast Asia . So , you can imagine the potential we have . With the support from the State and federal governments , we are very confident moving forward . The aerospace industry is one of the key strategic industries under the 12MP .

We are very selective where we go because we don ’ t want to be a “ Jack of all trades , master of none ”.

How much of the group ' s revenue is contributed by the Energy business ? How about aerospace ? Right now , 70 per cent is from the energy business and 30 per cent for the others . We think aerospace can take a more significant chunk of our revenue . We are stable as far as our energy division is concerned , but we need some time to get the aerospace business up and running .

One thing about aerospace is that once you are in , you are solid because you are accredited . But to get in , the high cost is where the key is . The company ’ s aerospace and defence division business is picking up its metal surface treatment facility , receiving more jobs from local and international customers in the first half of 2021 .

Can you share your plan on T7 Global ’ s recent private placement ? T7 Global has proposed a private placement of up to 20 per cent of its issued shares to raise to RM43.93 million , earmarked mainly to finance the group ’ s working capital requirements .

We are looking for a strategic partner or investor that can add value capital . We are alright , especially once the MOPU comes in . We have been postponing this private placement for a while as we are looking for the right partner . — @ Green