Nam Cheong sees best quarter since listing as net profit more than doubles

Mainboard-listed Nam Cheong said on Tuesday it saw its strongest quarter since listing in 2011 with earnings in the three months to 30 September this year more than doubling.

Third quarter net profit surged 112 per cent to a record RM125.6 million (S$48.68 million) from RM59.2 million in the same period a year ago. This was achieved on the back of an 81 per cent increase in revenue to RM618.6 million from RM341.2 million in the year-ago quarter.

Nam Cheong, which is Malaysia's largest offshore support vessel builder, said it had strong gross profit margins of 24 per cent and an order book of approximately RM1.9 billion for deliveries stretching till 2016.

It also had "good headroom for expansion" with a strong cash position of RM790.9 million and improved net gearing ratio to 0.45 times as at September 30, 2014.

Said executive chairman Tiong Su Kouk: "The momentum of our order wins remains robust, with Nam Cheong securing a record order of 25 vessels worth approximately US$505 million on a year-to-date basis."

"Further, we also secured letters of intent worth US$186 million for our proprietary designed diesel-electric powered Anchor Handling Tug Supply vessels which we launched in October, despite volatile oil prices and challenging conditions in the wider market."

He added that the company's partnership with Marco Polo Marine Limited to form a joint venture and a proposed investment in their indirect subsidiary in Indonesia during the quarter will strengthen its position in the cabotage-protected Indonesian market.

"With these strategies established, we are well-placed in our pursuit in being a global player in the offshore and marine industry and our goal in being the largest OSV provider in the world by 2017," he said.