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Stocks In Focus SG (Keppel Corp, Mermaid Maritime Public Co, Raffles Medical Group) – 22/07/13
Keppel Increases Investment In KrisEnergy By $185.4m
Keppel Corporation announced that following the completion of the call option exercise and the cornerstone subscription, its wholly-owned subsidiary, Devan International, acquired another 168.5 million shares of the post-initial public offerings (IPO) issued capital of KrisEnergy. The additional investment is valued at approximately $185.4 million. Keppel’s shareholding in KrisEnergy has therefore increased from 15.3 percent to 31.4 percent, based on the post-IPO issued share capital of KrisEnergy of 1,046,154,000 shares.
Significance: KrisEnergy has a substantial portfolio of assets, the increase in investment to KrisEnergy would be seen as a strategic move by Keppel to move upstream in the value chain.
Mermaid Maritime Wins Contracts Worth US$28m
Mermaid Maritime announced that its seascape unit, PT Seascape Surveys Indonesia, has won two new contracts with international upstream oil and gas companies who are existing clients having a total estimated value of US$28 million. The first contract is a three year inspection, repair and maintenance (IRM) contact which will utilize the DP2 vessel M.V. Endeavour for works commencing in July 2013. The duration of the contract is approximately 100 days each year through 2015 worth approximately US$23 million. The second contract is for survey and positioning services over a period of three and a half years with an estimated value of US$5 million and comprises a six month extension of an existing contract as well as an additional three year contact award for the same services thereafter.
Significance: The contracts won display Mermaid’s competency and competitiveness in its field. However, its gross profit margin needs to be monitored as seen in first half of 2013, which has a higher cost of service recorded compared to its service income, mainly due to a one-off zero revenue with operating expenses of THB 93.4 million incurred.
Raffles Medical 2Q13 Net Profit Up 15.9%
Raffles Medical Group posted a net profit of $14.4 million for its second quarter ended 30 June 2013, up 15.9 percent year-on-year. The group recorded revenue of $86.8 million, an increase of 12.9 percent from $76.9 million a year ago, driven primarily by the increase in turnover from its hospital services and healthcare services business segments, which grew 16.8 percent and 6.8 percent year-on-year respectively. Earnings per share rose to $0.0263 for 2Q13, up from $0.0231 a year earlier. Peering ahead, the group said the stronger performance experienced in the first half of the year should carry though into 2H13, thanks to continuing growth in corporate sales (new corporate clientele in the hospitality and education sectors) and with three new branches opening in major suburban population regions.
Significance: For the first half period, the group declared an interim ordinary dividend of $0.01, unchanged from a year ago. The dividend will be paid on 29 August 2013.
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