EOC Limited (EOC or the Group), an associate company of Singapore's Ezra Holdings Limited and a provider of offshore accommodation, construction and production vessels and services to the oil and gas (O&G) sector, posted a net attributable profit (PATMI) of $3.9 million for the third quarter ended May 31 (3Q FY14), up from $2.9 million in the same quarter last year.
Revenue slipped 12 percent from $12.3 million in the corresponding period to $10.8 million as the Lewek Chancellor accommodation vessel transitioned to a new two-year charter (with an option for an additional year) in Africa. EOC's two accommodation vessels were fully deployed as at May 2014, with the Lewek Conqueror currently working on a five-year contract in Southeast Asia.
In the floating production, storage and offloading (FPSO) segment, contributions from associates rose sharply to $4.5 million, up from $0.1 million in 3Q FY13 as EOC’s two FPSO vessels operated at nearly 100 percent uptime during this period. The firm's 41.3 percent-owned Lewek EMAS is operating offshore Vietnam while the 49 percent-owned Perisai Kamelia has been deployed to a fast-track gas production project in the North Malay Basin in Malaysia.
“The Group’s earnings visibility has improved now that both our accommodation vessels and our FPSOs are on long-term contracts and are performing well. Our improved balance sheet will give us the flexibility to capitalize on opportunities in the accommodation and support segment,” EOC’s Chief Financial Officer Jason Goh said in a press release.
The firm noted that the $200 million sale-and-leaseback arrangement for the Lewek Champion in February 2014 might have affected operating costs during the quarter, which stood at a loss of $188,000 in 3Q FY14 compared to a gain of $968,000 in the previous year. Its net gearing improved to 15 percent at end-May, compared with 230 percent last year.
Looking ahead, EOC expects "activity levels in the offshore O&G sector to be well supported and to see robust demand for accommodation and support services, in view of increased mid to deepwater operations and ageing production infrastructure in Asia."
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