ASL Marine taps into offshore fabrication works

ASL Marine likewise will focus on securing more conversion and major repair and refurbishment jobs for FSOs, FPSOs, and oil rigs.

OCBC Investment Research noted:

ASL Marine reported a 26.3% increase in revenue to S$117.0m and a 42.3% rise in net profit to S$8.3m in 3QFY12 such that FY12 net profit (S$32.3m) accounted for 99% and 97% of ours and the street’s full year estimates, respectively.

Gross profit margin was higher at 15.3% in 4QFY12 vs 14.7% in 4QFY11 and 14.0% in 3QFY12. We note that a provision of S$4.7m was made against an amount owing from subsidiaries of PT Berlian Laju Tanker after the customer ran into financial difficulties; excluding this would boost PATMI to around S$37m (up 16% compared to FY11).

For the repair and conversion division, the group will focus on securing more conversion and major repair and refurbishment jobs for FSOs, FPSOs and oil rigs (there are currently six older jack-up rigs that are under repair/upgrade in ASL’s yards). The group has also expressed its desire to develop its capabilities in offshore fabrication works.

ASL’s shipbuilding order book from external customers stood around S$586m as at 30 Jun 2012, and 53% of this amount is expected to be recognized in FY13. This means that the group may book shipbuilding revenue of S$312m in FY13, a 40% increase over FY12.

However, FY13 is likely to be a backend-loaded year for the shipbuilding division. Meanwhile, ASL also has an outstanding order book of about S$59m with respect to long-term ship chartering contracts.