Mermaid

Mermaid: Reported FY10 results which were below expectations, with FY10 rev at Bt3.5b,
-33.3%YoY and net loss of -Bt456.5m, -161.1%YoY. For 4QFY10, grp reported rev of Bt799.4m, -34.3%YoY & -9.3%QoQ and net loss of Bt114.3m, -176.8%YoY & +57.7%QoQ. Weaker earnings were attributed to lower utilisation and rates for both grp’s subsea and drilling segments….

Utilisation for subsea assets was at 39.5% in FY10 (vs 52.6% in FY09) while rates fell approximately 21.7%YoY. Utilisation for the drilling division was at 56.4% in FY10 (vs 94.9% in FY10), as segment was negatively impacted by the extended off-charter period for the MTR-1, which faced difficulty securing employment due to its age….

UOBKH however maintains Buy Call, based on valuations grounds, noting that grp currently trades at a compelling 0.6x P/B, and has a TP of $0.70, peg to 1x FY11F P/B. Seperately, CIMB downgrades stock to underperform, and reduces TP to $0.46 from $0.52.