ASL Marine

ASL Marine: Annouced 2Q12 results which was in-line. Rev at $77.4m (-25% yoy and 7% qoq) while net profit at $10m, -24% yoy and -11% qoq.

Lower yoy and qoq results was was due to a slower shipbuilding orderbook drawdown and lower repair/conversion rev. Offsetting the weak revenue was 2Q’s 17.3% gross margin, which surprised on the upside on stronger margins across all divisions.

Going forward, mgt not that order revivals are firmly on track, with ASL securing a further $54m of shipbuilding orders recently, bringing outstanding orderbook to
$553m, or a book-to-bill ratio of 2.1x. ASL has secured S$349m of shipbuilding orders in FY12 YTD, significantly above ASL’s 5-year historical average order wins of $238m/yr, and is the second highest order intake since FY07’s record $467m.

DBSV maintains BUY, TP $0.78 as house roll forward valuation to FY13F (from blended FY12/13F), still pegged to 7x PE for shipbuilding and chartering businesses, and
10x for repair (or an implied target FY12/13F PE of 10.2x/7.7x).