Gaylin Holdings Limited (“Gaylin” or the “Group”), one of the largest Singapore-based multi-disciplinary specialist providers of rigging and lifting solutions to the global offshore oil and gas (“O&G”) industry, today reported a strong set of results for the second quarter ended 30 September 2013 (“2Q FY2014”), with profits up 17.0% at S$3.7 million on the back of strong topline growth.
With contribution from the ship supply segment resulting from its acquisition of Allseas Marine Services Pte Ltd (“Allseas Marine”), as well as a major project, the Group registered a robust growth of 38.8% in revenue to S$29.0 million in 2Q FY2014, compared to S$20.9 million in the previous corresponding quarter. For the six months ended 30 September 2013 (“HY FY2014”), the Group’s revenue grew 24.0% to S$48.7 million.
The Group’s gross profit increased by 12.8% to S$14.7 million in HY FY2014, with gross profit margin dipping 3.0 percentage points to 30.1%, as sales of lower margin products formed a higher proportion of the Group’s revenue.
In line with the higher revenue achieved in 2Q FY2014, the Group’s net profit rose 17.0% to S$3.7 million. For HY FY2014, the net profit dipped 6.2% to S$6.1 million mainly due to lower gross profit margin as well as higher staff-related cost as the Group increased headcount to support business expansion.
Based on 432 million ordinary shares in issue, the Group’s earnings per share (“EPS”) for HY FY2014 and net asset value per share (“NAV”) as at 30 September 2013 was 1.41 Singapore cents and 21.38 Singapore cents respectively.
Commenting on the results, Mr Desmond Teo, Executive Director and CEO of Gaylin, said, “Despite the slowing growth momentum of the world economy, we have managed to achieve healthy growth for 2Q FY2014 on the back of our expanded footprint in the region. Rising cost pressures in the domestic market is a challenge which we will monitor closely. Going forward, we will continue to improve our productivity and efficiency to create greater value for our shareholders.”
In spite of the uncertain world economic outlook, the Group is cautiously optimistic that the outlook on the oil and gas industries will be positive in the next 12 months.
As for our expansion plans in China, the acquisition of Lv Yang (Tianjin) Offshore Equipment Co., Ltd (“Lv Yang”) has created an effective platform for the Group to provide one-stop rigging and equipment solutions to the buoyant offshore oil and gas sector in China. In particular, the Bohai oilfield off the coast of Tianjin offers immense growth opportunities for rigging and lifting solution companies with experience and expertise, who can cater to the needs of the oil and gas companies operating there.
Gaylin has also made headway in South Korea by subscribing for 90% of the issued and paid up share capital of Phoenix Offshore Co., Ltd, a ship chandler supply company there.
“This is in line with our plans to grow our ship chandler’s supply business. In addition, we have expanded our geographical footprint to better cater to the growing demand from the oil and gas sector in this region. Going forward, we remain committed to expand our operations through acquisitions and strategic collaborations,” elaborated Mr Teo.
The Group’s new facility in Tanjung Langsat in the State of Johor, Malaysia, is expected to commence full operation by the end of 2013. This facility has the largest test bed in South East Asia with a capacity of 3,000 tonnes.
“This will complement our existing facilities spanning an aggregate area of approximately 524,354 sq ft, thus allowing us to better capitalize on the business opportunities in the emerging Asian markets,” added Mr Teo.