Kreuz

Kreuz: Revenues 26% y/y to US$193m, earnings rose 49% y/y to US$40m. FY12 gross profit margin increased by 2.2 ppts from 30.7% in FY2011 to 32.9%. The increase in gross profit margin is due mainly to the acquisition of the dynamic positioning construction class diving support vessel by the Group during FY2012 which has reduced the Group’s reliance on the third party vessels chartering thereby resulted in cost savings. Mgmt is confident about growth prospects, as the subsea sector is maintaining its current trend of continued growth in the shallow, medium and ultra-deep waters as subsea technology becomes an economically viable solution for increasingly remote or ultra-deepwater fields. Group has healthy order book of US$205m. Kreuz trades at 5.9x P/E, 1.3x P/B Peer Swiber trades at 10.1x P/E, 0.7x P/B.