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Stocks In Focus SG (SG Oct Mfg Output, Amplefield, MermaidM) – 28/11/13
Singapore’s October Manufacturing Output Rises 8%
Singapore’s manufacturing output posted a strong boost of 8 percent in October but fell short of market expectations due to a contraction of 2.3 percent in the biomedical manufacturing cluster. Despite softer performance in the biomedical sector, on a year-on-year (y-o-y) basis, the electronics sector continued its rise from September as growth rate in October increased 22.8 percent from 20 percent in the previous month. This was largely attributed to the expansion of most segments amid improvement in demand. The transport and engineering sector grew 8.9 percent as compared to October last year, underpinned by higher contributions from rig building projects. However, economists are still expecting the manufacturing sector to continue to power industrial growth in the months ahead. Excluding the volatile biomedical sector, industrial production would have grown 10.4 percent stronger year-on-year.
Significance: As the global economy picks up momentum in 2014, on a y-o-y basis, Singapore’s manufacturing growth in 2014 is expected to more than double to 3.7 percent from 1.4 percent in 2013, based on projections from the Economic Development Board.
Amplefield Reverse Losses In FY13
For the year ended 30 September 2013, Amplefield saw a 12.3 percent jump in revenue to $6.1 million from $5.5 million, in light of greater demand generated from customers in the non-hard disk drive industries. Notwithstanding the higher sales revenue generated for the year, costs of raw material input and consumables have edged up 6 percent from $2 million in FY12 to $2.2 million in FY13. Other operating income in FY13 fell 47.6 percent to $0.3 million which was offset by a 10.9 percent decline in other expenses from $3.2 million in FY12 to $2.8 million in FY13. Meanwhile, the company has recognised a $2.3 million gain on waiver of time barred creditors for the year. Consequently, losses in FY12 were reversed as Amplefield’s FY13 earnings returned to the positive territory at $1.1 million.
Significance: In view of the challenging global economic climate, the company expects market demand to remain challenging while continuing its effort to create new customer base and at the same time reducing costs and improving operating efficiencies.
Mermaid Maritime’s FY13 Earnings Soar More Than 3-Folds
Mermaid Maritime recognised a turnover of US$269.6 million in FY13, representing a 46.9 percent rise in revenue as compared to US$183.6 million in FY12. The positive performance for the year ended 30 September 2013, was mainly contributed from its subsea and survey services segment. On the other hand, gross profit margin in FY13 has declined 3.7 percentage points to 18.8 percent as compared to 22.5 percent in FY12. This was as a result of a 53.9 percent increase in cost of services to US$218.9 million in FY13. Total expenses for the year expanded 11.7 percent to US$28.1 million due to an increase in administrative expenses incurred from the startup costs and services in the Middle East region. This has led the company to generate earnings of US$15.7 million in FY13, a jump of 388.9 percent from US$3.4 million when compared to the previous year.
Significance: In response to the positive performance of the company, Mermaid Maritime has approved both a special and final dividend per share of $0.0036 and $0.005 respectively.
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