Ezion Holdings posts strong growth despite volatile market

As its 3Q11 core net profit is expected to improve to US$13.5m with the addition of one new liftboat last June.

DMG says the company’s FY11-13F earnings are backed by long term contracts from its liftboats and steady contribution from the logistics division.

Here’s more from DMG:

Maintain positive view on the stock. We recently met with management and re-iterate our BUY rating on the stock: (1) Share price has fallen 20% since end Jul 2011, tracking the fall in FTSE SG Small Cap Index. We see no change in fundamentals as FY11-13F earnings are backed by long term contracts from its liftboats and steady contribution from the logistics division. We expect +28% EPS CAGR over FY11-13F; (2) Management continues to deliver strong growth as more liftboats are deployed. We estimate 3Q11 core net profit to improve to ~US$13.5m (+10% QoQ, +60% YoY) with the addition of one new liftboat in end-Jun 2011. We revised our TP to S$1.02 based on 12x FD FY11/12F EPS. Key catalysts are new contract awards and continued delivery of strong quarterly earnings.

Positive feedbacks from Asia-Pacific clients on liftboat. In the past three months, Ezion has deployed its Liftboat 4 to Vietnam, Indonesia and Malaysia for paid trials to gauge interest in the asset. Feedbacks are positive and management plans to use the liftboat in Asia-Pacific on long term time charter. While Ezion currently enjoys strong demand for its liftboats in Africa and Middle East, we see significant market potential in Asia Pacific given the high number of ageing platforms in the region.

Update on existing businesses; minor changes to FY11-12F EPS: (1) Liftboat Five and Six are scheduled to be ready in Mar 2012 and May 2012 respectively. The deliveries are delayed by one month due to late delivery of critical items. (2) The refurbishment of a service rig to be used in the North Sea is one month ahead of schedule and could be deployed by early Dec 2011. We have revised our FY11-12F earnings by +2% and -4% respectively.

New competition for Northern Territory marine supply base. Upstream reported that a consortium led by Aberdeen-based Asco has won a bid to develop a marine supply base in Australia’s Northern Territory. The new site will compete against Ezion’s Melville Island supply base. We believe it is too early to ascertain the amount of competition in that area as the various projects remain at the planning stage. We have not factored in any contribution from the marine supply base projects.

Photo from todaysart

If you've been wondering whether SBR could work for your company — yes, probably.

A lot of the companies we partner with started as readers. They'd been following our coverage for a while, saw their own customers and competitors in it, and eventually asked the obvious question: could we do something with you? The answer is usually yes. The shape of it depends on what you're trying to do.

The options are broader than most people assume — thought leadership articles, sponsored content, industry summits across Southeast Asia, regional awards programmes, podcasts, and media placements in print and digital. Some partners use one channel; most use a mix. We figure out the right combination by starting with your brief, not with our rate card.

So if the question has been on your mind, here's the easy way to ask it.

We'll tell you honestly whether we can help, and how. It's a better use of everyone's time.

Book a meeting

| Or download the media kit (PDF)

240,000 senior readers quarterly in print Top 1,700 Singapore companies reached

7 markets across Southeast Asia