Seatrium (formerly known as SembMarine)

[winston]

Not vested. From CIMB:-

SembCorp Marine (S$3.44) - 3Q09 results - Positioning for the future

Maintain Outperform on SMM and target price of S$4.38, still based on blended valuations. 3Q09 net profit of S$145m (+3% yoy) was 14% above our estimate and consensus, thanks to stronger-than-expected order-book recognition.

We raise our earnings by 1.5% for FY09 to adjust for this. SMM remains our top pick
among offshore & marine large caps owing to its pure exposure to the sector. A surge in order wins and a potential new yard acquisition in Brazil could provide short-term catalysts to the stock, we believe.

SMM also announced a S$750m capex plan to develop an integrated new yard facility in Singapore to expand its ship repair and conversion business. We estimate S$80m of annual earnings contribution from Phase 1 of the new yard from 2014, assuming full utilisation of the ship-repair facilities.

[winston]

Not vested. From UOBKH:-

Valuation

Raise fair price to reflect high oil price premium. We raise our fair price from S$2.60 to S$3.20. Our sum-of-the-parts (SOTP) valuation of S$3.16/share is premised on the following:-

a) we now value SMM’s own shipyard business at a higher PE of 18x vs 15x previously (i.e. pre-offshore oil & gas boom valuation for large shipyards) of longer term sustainable
earnings in view of continued strong oil prices, though contract flow remains low,

b) we have assumed SMM’s longer term sustainable contract wins level of S$3b p.a., thus translating into an annual net profit base of S$245m, and

c) SMM’s 30% stake in CSG is valued at a PE of 12.0x of its earnings based on a long-term sustainable contract win level of S$2.0b p.a.

[winston]

Not vested. From OCBC:-

SembCorp Marine Ltd: Optimistic about the future

Summary: With regards to SembCorp Marine’s new yard announcement last month, we think our position is best encapsulated as: we believe in Singapore’s future as a ship repair and rig building hub, and building a new yard for the future is the way to go.

SMM is seeing a pick up in the number of enquiries from potential customers and is optimistic about future orders. We think the focus will increasingly be on deepwater rigs (mainly semi-submersibles and drillships); but demand for jack-ups may remain weak given a potential oversupply situation.

Besides enjoying higher revenue each year since 2004, the group has also been delivering better operating and gross profit margins, with the former reaching 10.8% and the latter 12.5% for 9M09. We are estimating similar margins for FY10, though there is a possibility of improvements later.

With an impressive track record of deliveries, SMM’s recent joint venture in India should net it more rig and ship repair business. SMM has also signed favoured customer contracts with major industry players such as Transocean and Aban Offshore.

We are raising our fair value estimate to S$4.16 as we factor in contributions from the joint venture project with Kakinada in India. Maintain BUY. (Low Pei Han )

[winston]

Capex and Execution Risk ?

Singapore's Sembcorp Marine to build shipyard in Brazil

SINGAPORE, Feb 4 (Reuters) - Singapore's Sembcorp Marine , the world's second largest offshore oil rig builder, said on Thursday it has bought land for a new shipyard in Brazil.

The freehold site of 825,000 square metres is near the Espirito Santo Basin, which is one of the country's recently discovered offshore giant pre-salt oil basins.

Sembcorp Marine declined to reveal the cost of the land.


Source: Reuters

[winston]

SEMBCORP INDUSTRIES - Sembcorp Industries , an engineering and rig-building conglomerate, wants to grow its Middle East business but has put on hold its European expansion plans, the firm said in an interview with Business Times.

[winston]

BUSINESS TIMES -- Engineering and rig-building conglomerate Sembcorp Industries is keen to grow its Middle East business by clinching more water and power projects, CEO Tang Kin Fei said in an interview.

The firm already has a $1.7-billion project in the United Arab Emirates and a $1-billion contract in Oman.

The Singapore firm will, however, put on hold its European expansion plans as its customers are planning to rationalise their operations.


Source: Reuters

[Aspellian]

Sembcorp building a new mega-yard in Spore and another one in the near future in Brazil.
Expanding aggressively in MiddleEast.

High capex, more opex required - probably a fund raising exercise soon? either bonds,rights issues, share placement (more unlikely) on the card?

[winston]

Singapore's Sembcorp says wins S$130 mln contracts

SINGAPORE, Feb 18 (Reuters) - Sembcorp Marine , the world's second-largest offshore oil rig builder, said on Thursday it had clinched several ship repair and upgrading deals worth S$130 million ($92.46 million).

It also said it has renewed a long-term contract with Eitzen Group which will send six to eight ships for repairs and upgrading annually.


Source: Reuters

[winston]

Sembcorp Marine Q4 net profit fourfold, optimistic on 2010

SINGAPORE - Sembcorp Marine, the world's second larger builder of offshore oil rigs, reported on Monday a four-fold rise in fourth quarter net profit as it completed more high-margin projects.

Sembcorp posted a net profit of S$297.2 million (US$211.2 million) for the three months ended December, up from S$69.4 million a year earlier.

The Singapore firm earned S$756.8 million for the full year.

'The financial year 2009 was an exceptional year in terms of profit. With the existing orders, the Group expects to achieve satisfactory results for FY 2010,' the company said in a statement.

Sembcorp, the number two offshore oil rig maker after fellow Singapore firm Keppel Corp, said its orderbook stood at S$5.5 billion as of December, down from the S$6.7 billion figure reported when it presented its third quarter earnings.

Source: REUTERS

[winston]

Not vested. From UOBKH:-

Stock Impact
• A good set of results, but nonetheless, are backward looking.
• Given 2009’s low contract wins of S$1.25b (2008: S$5.66b), SMM’s orderbook has fallen to S$5.5b from S$9.0b a year ago.
• Contract wins will be the key issue in 2010. We maintain our annual new contract win forecasts of S$3b for 2010 and S$4b each for 2011 and 2012.
• We raise our FY10-12 net profit forecasts by 9%. 2010’s EBITDA margin has been raised by 1ppt to 13% (2009: 16.4%, 9M09: 13%)
• We raise our target price by 4% to S$3.60, based on our revised sum-ofthe-parts (SOTP) valuation of S$3.64/share. It values SMM’s own shipyard on:
a) a long-term sustainable annual contract wins of S$4b,
b) an EBITDA margin of 10%, resulting in a net profit of S$335m, and
c) at a PE of 15x net profit