PACC Offshore Services Holdings (POSH): Cost cutting measures by oil and gas companies have led to falling rig utilisation rates and in turn impacted the demand for offshore support vessels. For POSH, the impact is even greater as it faced country-specific challenges in Mexico and Brazil. It’s JVs in Mexico continued to incur losses in 1Q15, and this amounted to US$5.3m. Looking ahead, the Mexico JV losses are likely to be stemmed as POSH has transferred the vessels to its OSV fleet as they pursue international charters.
POSH’s financial position remains strong, with net gearing standing at 0.5x as at end Mar 2015. It has been relatively conservative in terms of its vessel newbuild programme, and PaxOcean yard in China offers some flexibility in terms of adjusting newbuild schedules and specifications.
Given the dim outlook of the industry, OCBC maintains its HOLD rating and reduces its TP to $0.44 from $0.50. Entry point at $0.395 or lower.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment