Coastal Contracts Bhd (“Coastal” or “Company”) announced that its wholly-owned subsidiaries, Thaumas Marine Ltd and Coastal Marine Pte Ltd have collectively secured contracts for the sales of one unit Subsea Support Maintenance Vessel (“SSMV”) and two units low-end vessels for an aggregate value of approximately RM148 million.
Apart from the one unit SSMV and one unit low-end vessel which were sold to repeat customers, the other one unit low-end vessel was sold to a new customer. This is the fifth batch of vessel sales order secured by the Group in FY2013. With the securing of these latest sales, the total value of the Group’s vessel sales order book stood at approximately RM1.34 billion.
All of these vessels are expected to be delivered in 2013 and 2014. Consequently, the revenue stream from these vessels is expected to contribute positively to the top and bottom line performance of the Group for the financial years ending 31 December 2013 and 31 December 2014.
Mr Ng Chin Heng, the Executive Chairman of Coastal, commented:
“I am pleased to announce that Coastal Group has secured another batch of vessel sales orders with an aggregate value of approximately RM148 million. With these new orders under our belts, Coastal Group’s cumulative vessel sales orders secured in FY2013 alone amounted to approximately RM1.5 billion, which has reached a fresh record high of yearly vessel sales orders. Including these new contract wins, Coastal Group is sitting on a comfortable vessel sales order book which amounting RM1.34 billion. This will keep us busy in FY2014.
Global demand for energy continues to grow, especially in developing countries. Recent strong recovery of developed countries, such as United States and certain Eurozone countries will further strengthen the global demand for energy. We believe the current pace of expansion in OSV orders will not be short-lived, as stable crude oil prices will continue to fuel more offshore exploration, development and production activities. With the significant hydrocarbon discoveries in the deepwater regions, such as the Golden Triangle – West Africa, US Gulf of Mexico and Brazil, we foreseen the deepwater capable OSV market will have further growth opportunities.”
Mr Ng further added:
“We have already scaled up the shipbuilding value chain to focus on larger and deepwater capable OSV with specialisations to service increasingly complicated offshore operations and rigs in deepwater regions and even in ultra-deepwater regions. We believe the current buoyant drilling activity and bidding activity will be a strong catalyst to help Coastal Group capture the strong demand for OSV and fast-track its earnings expansion.”
Press Release, December 11, 2013