Monday, December 30, 2013

Perdana Petroleum - benefit from future contract flows

It expects to benefit from future contract flows from new developments in the oil and gas industry, such as enhanced oil recovery initiatives and marginal fields.

In Nov 2013, Petroleum Perdana terminated a bareboat charter on three vessels, and entered into a memorandum of agreements to acquire the vessels instead for a total of US$50mil. The move is expected to enhance the company’s bottom line in 2014.

In general, 2014 is set to be a good year for Petroleum Perdana, especially with its associate company Dayang Enterprise Holdings Bhd starting its topside major maintenance/hook-up construction and commissioning project in the year ahead.

Including the vessels chartered to Dayang, 15 of Petroleum Perdana’s 17 vessels are now (Dec 2013) on long-term charters. Its current orderbook totals RM1.4bil, with five years’ earnings visibility.

For the nine months to September 2013, Petroleum Perdana’s net profit more than tripled to RM39.8mil from RM12.1mil in the corresponding period a year earlier. Earnings per share stood at 7.94 sen, compared with 2.45 sen previously. Group revenue, on the other hand, increased only a marginal 0.6% to RM196.6mil compared with RM195.3mil previously.

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Please note that all data given are merely blogger's opinion. It is strongly recommended that you do your own analysis and research before investing.