Triyards

Triyards: 1QFY16 net profit fell 25% y/y to US$6.2m, making 21% of full year street estimates.

Revenue climbed 38% to US$78.1m, contributed by works on four units of self-elevating units, and two units of multi-purpose support vessels, as well as certain industrial and offshore fabrication projects.

Gross margin fell 4.3ppt to 18.7% due to different project mix.

Other income dropped to US$70,000 from US$3.9m, largely due to the absence of negative goodwill booked from the acquisition of Strategic Marine Group last year.

Meanwhile, admin expenses stayed flat at US$6.6m.

Orderbook stood at US$564m. These included US$180.1m order wins between Oct-Dec last year. Management emphasized Triyard’s conscientious efforts to diversify away from the beleaguered O&G space, highlighting its expanded offerings which include chemical tanker, scientific research vessel and windfarm crew transfer vessel. Notwithstanding, Triyards still sees a challenging year ahead.

Triyards is currently trading at 3.7x FY16e consensus P/E.