Friday, March 14, 2014

Deleum - long term contracts and steady dividend payout

It has proposed a bonus issue and share split.

After both exercises, Deleum will have an issued and paid up ordinary share capital of rm200 million capex comprising 400 million shares.

It has a high order book of rm3.3 billion. Roughly 60% of the of the order is for power and machinery segment and the remainder for oilfield services and maintenance, repair, and overhaul segment.

The current order book will sustain earnings till 2020.

The group has ventured into the asset integration solutions business. To recap, this is a fairly new area of growth for the group which could start to bear fruit in FY2015. It involves services relating to enhanced oil recovery where Deleum could provide either mechanical or chemical solutions to improve productions at underperforming wells, or reactivate wells.

It is liked for its sold earnings growth which is backed by steady recurring income from long term contracts as well as steady dividend payout.

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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.