Jaya

Jaya: Announced weak 1Q12 results, below estimates, on back of a slow down in shipbuilding. Rev at US$28.5m, -51% yoy, and +68.6% qoq while net profit at US$4.8m, -79% yoy and +22.7% qoq. Gross Margins was however weaker at 29.8% vs 34.7% yoy.

Rev was led by grp’s Offshore Shipping Division whose rev at US$16.0m, +18% yoy, while rev from grp’s Shipbuilding Division of US$12.5m was- 72% yoy. These shifts in rev were consistent with grp’s increased focus on its chartering business.

Higher Offshore Shipping Division’s rev was attributable to higher charter utilisation for the qtr under review at 68% vs 66% yoy, while Fleet size grew to 28 vessels vs 21 yoy. The Shipbuilding Division recorded significantly lower rev as a grp sold only one vessel vs 3 yoy. Lower yoy bottomline was also attributed to other income which fell 92% yoy to $0.64m, due to the disposal of one vessel and translation gains in the previous corresponding qtr.

Valuation remains undemanding with grp trading at 0.58x P/B vs historical average of 2x, and FY12E ROE of 8.5x.