Malta-based industrial logistics firm MedservRegis announced that it has been awarded two new contracts – for the provision of logistics and support services in Mozambique and for a pilot Vendor Managed Inventory project in Saudi Arabia.
MedservRegis said the Mozambique contract was awarded by a leading international engineering and drilling contractor, an existing client of the Group, for a period of two years.
It said that while the contract value “is not material” in the context of the group, it is strategically significant as it strengthens its operational presence in Mozambique and supports its growth ambitions across sub-Saharan Africa.
In the Kingdom of Saudi Arabia, MedServRegis has secured a contract for a pilot VMI project, which has the potential to develop into a significantly larger scope of work subject to successful implementation.
“These contract awards reflect the Group's ability to leverage long-standing customer relationships across multiple markets and support clients as they expand their operations internationally,” it said.
MedServRegis also delivered an update about its operations in Iraq in light of the Iran war leading to prolonged disruption of shipping routes through the Strait of Hormuz.
The company pointed out that disruption in the Strait has led to reduced activity levels within Iraq’s oil and gas sector since the beginning of the third quarter of the year.
“Management considers the reduction in activity to be temporary in nature and primarily attributable to the current disruption in Iraq's oil export routes rather than any deterioration in the underlying demand for the Group's services,” it said.
In response, MedservRegis’s management has implemented some “cost containment” measures, including workforce and compensation adjustments, along with the temporary redeployment of resources across other Middle East operations.
“These actions have enabled the business to operate through the current slowdown with a significantly leaner cost base, while preserving the operational capabilities required to support the anticipated recovery in activity,” it said.
It added that it is encouraged by recent developments in Iraq, including the extension of its machine shop services contract with its main customer, and the awarding of a new three-year machine shop services contract in the country.
“These developments reinforce management's confidence in the long-term fundamentals of the Iraqi business and its ability to benefit from the expected recovery in activity levels once normal oil export operations resume,” MedservRegis said.
“The contract awards announced today, together with the Group's continued geographic diversification and long-term customer relationships, support MedservRegis' strategy of delivering sustainable growth while maintaining resilience across its international operations.”
