Swiber

Swiber: lifts halt at 8.30am this morning. The co announces new contracts worth US$830m for offshore construction projects and vessel chartering services in the Asia Pac region. Details of individual contracts weren’t disclosed, though they include projects for engrg, procurement and installation of pipelines, umbilicals and subsea systems. It will also provide services for the transportation and installation of wellhead structures and associated pipelines, and provide vessel chartering services in the region. Work on these projects will commence immediately and will carry on into 2014. In addition, Swiber said it has received a contract through a JV co to charter out support vessels in the Middle East, with a committed period of 3yrs and an additional option period of 2 yrs. The contract period will commence immediately and is expected to continue until 2017, if all options are exercised. Mgt says, “without a doubt, Swiber is on a winning streak”. Says the co is clinching larget and larger contracts in the Asian and Middle East markets and breaking into new frontiers such as the Gulf of Mexico. Together with the recent US$175m JV contract with SMM for offshore construction work, we estimate Swiber’s orderbook to amount to ~US$1.8b, vs FY11 revenue of US$654m. Despite the orderbook visibility, Swiber trades at 6.7x P/E, and close to the 2008 financial crisis low of 0.5x P/B. Recent Street ratings are bullish (3 Buys, 1 Hold) with TP estimates btwn $0.66 – 0.86.