Swiber Holdings profit doubles to $25.6m

As revenue surged a blistering 59.3%.

Swiber Holdings Limited (Swiber), an integrated construction and support services provider to the offshore oil and gas industry, reported that the Group has achieved a 104.0% surge in net profit to US$25.6 million from US$12.5 million for the first quarter ended March 31, 2013 (1Q2013).

This was achieved on the back of a 59.3% jump in revenue to US$309.7 million over the same period, as the Group successfully executed on its full suite of services – Engineering, Procurement, Installation and Construction (EPIC), offshore marine and subsea services – mainly in Latin America, a market the Group entered in March 2012; and the Southeast Asia region, the company said in a release announcing its latest results.

Gross profit margin held at a healthy level of 16.1% for 1Q2013, notwithstanding higher cost of sales in line with the rise in revenue.

Said Mr. Francis Wong, Group Chief Executive Officer and President of Swiber, “We are pleased to have made further inroads into Latin America. The Gulf of Mexico is one of the most exciting regions for the oil and gas industry today. From winning our first contract in this country in March last year, the region has grown rapidly to account for more than 26.4% of our revenue this quarter. We believe that this region still holds tremendous opportunities for us, as almost every global oil major is racing to explore and develop fields in this area.

“In the meantime, we have maintained our financial flexibility with our strong cash position and a Multicurrency Medium Term Note Programme in place, to provide us with the necessary financing to seize business opportunities globally as they arise.”

For 1Q2013, apart from robust revenue, Swiber’s bottomline was also boosted by a significant improvement in share of profit from associates and joint ventures, which rose 91.0% to approximately US$4.7 million with the delivery of higher profit from certain associates.

In line with business expansion, higher bank borrowings and issuance of debt securities, the Group incurred higher administrative expenses of US$14.7 million and finance costs of US$9.3 million respectively in 1Q2013, which had some impact on bottomline.

Swiber’s basic earnings per share, based on its 1Q2013 results, was 3.3 US cents from 1.5 US cents in 1Q2012, while net asset value per share rose to 81.7 US cents as at March 31, 2013, from 79.3 US cents as at FY2012.

After the April issue of S$160 million 7.125% fixed rate notes due 2017, Swiber has an additional capacity of S$320 million under the Multicurrency Medium Term Note (“MTN”) Programme. Together with cash and cash equivalents of US$155.8 million, the Group continues to have strong financial flexibility.

As at May 2013, Swiber’s order book stands strong at approximately US$1.1 billion.

Commenting on the prospects of 2013, Mr. Wong added, “The growing oil and gas demand continues to drive higher levels of upstream capex on new projects. Still, having the right technology would be of paramount importance for us to effectively capture the business opportunities that may arise. We will continue to stay ahead of the curve by adopting the latest engineering technologies to provide comprehensive and high value added solutions to our clients worldwide.”