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Singapore Daily Bulletin – 20/03/12
Daily Bulletin | 20 March 2012
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Mencast To Raise Funds Through Placement Exercise
In further signs of corporate entities taking advantage of increased liquidity in financial markets, Mencast Holdings, will be the latest local counter to raise funds through a placement exercise. Mencast has announced on 20 March 2012 that it had entered into subscription agreements with several private and institutional investors to place up to 22.5 million new shares at an issue price of $0.53 apiece. The new shares represent a discount of approximately 5.4 percent over the weighted average trading price of shares of $0.56 on 14 March 2012. The anchor investor of this exercise will contribute around $3.7 million to the overall gross proceeds. SME-Co Investment Fund, a private equity fund managed by Heliconia Capital Management will subscribe to 7 million new shares. Mencast estimates that net proceeds of the placement exercise will be in the region of around $11.9 million after deducting costs. It intends to use the proceeds for future acquisitions, expansions and general working capital requirements.

Significance: The placement exercise comes at a time when Mencast is experiencing solid growth in topline performance due to its acquisitions of TGEM and Unidive. However, the firm will need to look into consolidation as gross profit margins dived due to competitive pricings in its industry.

STX OSV Boosts Order Backlog By 1.15b Krone
STX OSV announced after trading hours on 19 March 2012 that it had boosted its order backlog by approximately 1.15 billion Norwegian Krone ($252.9 million). STX OSV had clinched two separate contracts to construct two subsea vessels, with one being a subsea support vessel and the other a subsea construction vessel. The construction of the subsea support vessel was inked with Island Offshore and is valued at NOK500 million ($110 million), with delivery expected in 1Q14. The other vessel, a subsea construction vessel will be built for DOF at a contract value of NOK650 million ($143 million) and be scheduled for delivery in 2Q13. The latter vessel boasts a new innovative moon pool concept from STX OSV, which has been developed over three years. Compared with conventional moon pool designs, this vessel will be able to operate in a wider range of weather conditions and in a safer manner for the ship’s crew and equipment.

Significance: These latest contract wins attests to the viability of STX OSV’s performance in the midst of global macroeconomic uncertainties. However, concerns are still rife with regards to the possible sale of its parent, STX Group’s stake in the company.

Centurion Buoyant About Its Dormitory Operations
Centurion Corporation, a foreign worker dormitory operator, says that it might declare a dividend with its upcoming 1Q12 financial report card. Tony Bin, Centurion’s executive director said that the firm owes its shareholders a constant dividend stream as it makes headways into new markets and grows its business. Centurion was unable to declare a dividend for FY11 as it recognised one-off impairment costs as well as its reverse acquisition expenses which led earnings into negative territory with losses of $6.2 million. Centurion remains optimistic about its dormitory business even in the face of a potential impact of higher foreign worker levies. Centurion’s dormitory operations made $5.4 million in FY11, while its optical disc operations, left over from the reverse takeover of SM Summit, contributed $1.53 million.

Significance: The firm is looking to make further inroads into its dormitory business overseas with the recent signings of MOUs in Malaysia. In addition, the firm plans to venture as far afield as the Middle East, where there is an increasing demand for special purpose-built dormitories.

Mencast Hldgs  0.060 +0.009 +17.65%   
Business: A regional maintenance, repair & overhaul solutions provider for the global offshore, marine and O&G sectors. [FY18 Turnover] Marine (57.5%), energy svcs (23.2%), offshore & engineering (19.3%).

Insight: May-19, 1Q19 revenue rose 41.8% due to increased r... Read More
Centurion Corp  0.405 -- --   
Business: Co engages in the accommodation and optical storage media manufacturing businesses. [FY18 Turnover] Workers accommodation (67.1%), students accommodation (31.4%), optical (1.5%).

Insight: Feb-19, FY18 revenue fell 12% mainly due to the le... Read More


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