EMS Energy unveils 3 core strategic thrusts

Following recent strategic review.

In reaction to the challenging macro-economic and operating environment, the Directors of EMS Energy recently reviewed the Group’s strategic positioning and accelerated its business development with the objective of increasing the size and scale of orders as well as profit margins.

EMS Energy's latest corporate and business update then identified 3 major strategic thrusts going forward, namely: 1) Formalisation of the Strategic Business Units (SBUs), 2) Expansion of the Group’s marketing network and business development strategy, and 3) Initiate measures to raise productivity.

In terms of formalising SBUs, EMS Energy said the Group has established SBU for our main product groups namely Rig Solutions, Crane and Lifting Solutions, and Marine Solutions.

"These SBUs will crystallise as a distinct divisions before the end of FY2013. It will gather business perspectives and leaders from the Group’s operating units and assess customer feedback. It will oversee efforts to maximise business opportunities and allocate human, technical or financial resources from the three segments," said the company.

"Without the immediate need to build up a large team, it will also oversee the execution of each component of the product and assess its returns and other opportunities to cross-sell or add value, with a view to increase sales and margins," it added.

For the second strategic thrust of expanding marketing networks and business development, the Group has leveraged on its local partners’ connections to obtain orders.

"In this regard, the Group has entered into a joint-marketing agreement with Scana Offshore Vestby AS of Norway and may consider entering into similar agreements with other foreign companies such as Dietswell S.A. of France to jointly promote drilling solutions and/or marine solutions," the company said.

In line with its marketing expansion, the Group has secured industry certification, such as the coveted American Petroleum Institute (API) certification since February 2011, to increase existing and prospective customers’ confidence. Amidst increased emphasis on quality and safety in the offshore and marine industry, the API monogram and the APIQR marks will boost clients’ confidence in the Group’s products and services, the company said.

The three API certifications attained by EMS are as follows: 1) API Specification Q1, 2) API Specification 4F for Substructures at PSL 1 (refers to Drilling and Well Servicing Structures), and 3) API Specification 2C for Offshore Pedestal Mounted Cranes.

Lastly, the Group is currently sourcing for a larger waterfront facility to increase its productivity in line with the third main strategic thrusts.

"This facility will help the Group increase its capacity to produce higher-margin projects, such as the Derrick Equipment Set (DES), Mobile Modular Work-over Unit (MMWU), Hydraulic Work-over Unit, Subsea Development Rigs, Offshore Cranes, and numerous Winch projects," said EMS Energy.

"The facility can reduce the Group’s operational costs by reducing dependence on the leasing of production and storage facilities, as well as subcontractors’ services. This will increase EMS Energy’s in-house design customisation capacity, in line with the Group’s strategy to focus on value-added services, and reduce dependence on fabrication," it added.

The Group has also implemented an Enterprise Resourcing Planning (ERP) system since the beginning of 2013 to manage and distribute corporate information across business units, break down organisational silos and strengthen cost controls. The system is equipped to measure, analyse and simulate in real-time. It has helped the Group to better understand its product cost structure, to improve quality, reduce costs and cash conversion cycles.

The Group is also seeking to strengthen its purchasing team and has initiated training to develop technical for procurement and inventory management.