TSC Offshore's 3Q Turnover Surges 296.8%
TSC Offshore has announced its unaudited consolidated turnover and profit attributable to equity holders for the nine months ended September 30, 2008 amounted to approximately US $101.9 million and US $4.4 million respectively, representing increases of approximately 352.0% and 63% when compared with those of the corresponding period of 2007.
The Group's turnover for the three months ended September 30, 2008 surged by approximately 296.8% from that of the same period last year to approximately US $36.8 million. Gross profit rose by approximately 156.4% to approximately US $8.6 million in the Period as compared with that of the same period last year. The Group's gross profit margin for the Period was approximately 23.3%. Profit attributable to equity holders for the Period amounted to approximately US $580,000 against US $967,000 of the same period of 2007.
The Group's Board of Directors do not recommend the payment of an interim dividend for the nine months ended September 30, 2008.
The significant increase in the Group's turnover during the Period was mainly due to strong growth in the sale of rig products and technology. During the Period, turnover of the Group's rig products and technology surged by 398% to approximately US $27.9 million from that of the same period last year.
The Group also achieved a satisfactory increase of 60.4% in its oilfield expendables and supplies business to approximately US $5.9 million when compared with that of the same period last year. During the Period, the Group continued implementing six turnkey contracts for cantilever and drilling systems and realised a turnover of approximately US $3 million based on the percentage of completion of the contracts.
For the nine months ended September 30, 2008, the Group's sales of rig products and technology as well as oilfield expendables and supplies amounted to approximately US $60.5 million and US $12.8 million respectively, representing increases of 417.0% and 24.4% from those of the same period last year respectively. Sales of rig turnkey solutions for the first nine months of 2008 amounted to approximately US $28.2 million, while the consultancy services business recorded a turnover of US $448,000. During the nine months ended September 30, 2008, the Group's rig products and technology sales was the largest contributor to the Group's turnover, accounting for 59.4%, followed by rig turnkey solutions (27.7%) and oilfield expendables and supplies (12.5%).
As of September 30, 2008, the Group carried an uninvoiced order book valued at approximately US $160 million for rig products & technology as well as turnkey solutions and expendables.
During the Period, TSC Offshore completed acquisition of shares of Global Marine Energy Plc, a company previously listed on Alternative Investment Market of the London Stock Exchange, and renamed it as TSC Offshore (UK) Limited ("TSC (UK)"). The results of TSC (UK) for the third quarter of 2008 were fully consolidated into the management account of the Group, and partly contributed to the significant growth in the Group’s total sales of rig products and technology for the Period.
On October 31, 2008, the Company entered into a Sale and Purchase Agreement with Lewiside Investments Limited to acquire the entire issued share capital and a sale loan of Center Mark International Limited for a consideration of HK$12,900,000 and RMB1,200,000 respectively. The acquisition will provide the Group with access to innovative jacking gear box, which together with TSC Offshore's jacking control system, allows the Group to offer complete jacking system.
Looking into the future, Jiang Binghua, the Executive Chairman of TSC Offshore remarked, "The uncertainty in oil and gas drilling industry due to the drop in oil price and financial tsunami in the USA may affect short-term demand. However, we expect the demand in the long run for drilling products and expendables shall continue to be strong. We will continue to implement stringent cost control and we are confident that our lower-cost manufacturing base in China, international sales and distribution network and the ability of offering complete offshore drilling equipment and 'turnkey solutions' to our clients worldwide will further strengthen our competitive position and sustain our business growth in the future."