Kreuz

Kreuz: (The Edge) New vessel expected to bring in higher margin projects to subsea service provider. Recall Kreuz recently announced plans to acquire a multipurpose subsea dive suppert and construction vessel worth US$113.7m. As Kreuz only provides subsea installion for shallow water rigs, the new vessel should allow the co. to venture into deeper waters where dd is rising. The proposed vessel will also increase the geographical reach and scope of services that Kreuz can offer. DBSV note that Kreuz should be able to derive min incremental rev of US$50m and net profit of up to US$15m from the new vessel. The new vessel should help Kreuz reduce its dependence on projects and rev from parent co. Kreuz. In FY12, Kreuz closed the yr with an orderbook of abt US$200m, of which 90% will be recognised in FY13. While for the yr, the grp has already secured an additional US$40.5m worth of orders. Kruez b/s remains strong with net gearing at 10%. Overall, Kreuz should benefit from rising demand for subsea services by global O&G Co’s.