A sinking ship: Ezra Holdings’ share price plunged 30% in just two months

It has lost almost half of its value.

Ezra Holdings is one of the firms hardest hit by the recent crash in Brent crude prices. According to OCBC, Ezra’s share price has fallen by about 30% since the start of September, and it has lost almost half of its value on a year-to-date basis. 

“In terms of share price performance, the company has been one of the hardest hit with the recent oil price fall, as it has a more deepwater-focused fleet. Its subsea segment also has exposure to the North Sea and there have been concerns about delays in project awards as well,” stated OCBC.

OCBC noted that Ezra needs to demonstrate sustained utilisation levels in the offshore supply vessel (OSV) division, along with sustained order wins for its subsea segment.

“Investors may also be cautious about oil companies with high net gearing, given the recent drop in risk appetite in the SGD-denominated bond market. As for the company’s operations, however, we note that FY14 (year end Aug) has actually been a better year in terms of core earnings (~US$29m vs. core net loss of ~US$37m in FY13),” the report said.