Coastal Contracts at record high

KUALA LUMPUR: Shares of Coastal Contracts surged to an all-time high of RM5.04 on Monday as investors chased up the stock on good earnings visibility.

At 4.40pm, it was up 25 sen to RM5.02. There were 2.70 million shares done at prices ranging from RM4.72 to RM5.04.

The FBM KLCI rose 7.16 points to 1,812.28. Turnover was 1.17 billion shares valued at RM1.32bil. There were 264 gainers, 479 losers and 318 counters unchanged.

UOB Kay Hian Malaysia Research said Coastal Contracts was raising funds to beef up it financial capability to undertake more projects.

It said Coastal Contracts had previously announced that it will undertake a private placement of up to 10% of its issued and paid-up share capital. The issue price of placement shares will be determined at a later date pending the receipt of approval.

"Management expects the placement to be done in the near term (within three months) and intends to use the proceeds to fund the purchase of its US$200mil jack-up and other working capital purpose," it said.

"In 2013, Coastal Contracts secured vessel orders of RM1.35bil, which is a new record for the group and nearly double of 2012's RM698m. With the recent charter wins, Coastal's orderbook stands at a healthy RM2.5bil (Offshore support vessels arm: about RM1.1bil), providing strong earnings visibility," it said.

As at end-December 2013, Coastal Contracts was in a net cash position of RM303mil, higher than the RM208mil in 2012.

"Coastal is expected to turn into a net gearing (net debt/equity) of about 0.2 times by end 2014 with the expected acquisition of the jack-up drilling rig. This is still lower than industry peer's average of 0.45 times," it said.

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 1
Cxense type: free
User access status: 3
Join our Telegram channel to get our Evening Alerts and breaking news highlights

Next In Business News

Palm oil retreats on profit taking
Pfizer boosts forecast for vaccine sales to US$33.5bil
McDonald's sales surge on BTS meal craze, new crispy chicken sandwich
Singapore central bank removes caps on dividend payments by local banks
Mercury bags RM450mil construction job in Johor Baru�
Glomac registers RM28.3mil profit in FY21
KLCI ekes out slight gains, Petronas stocks, Tenaga advance
AstraZeneca second dose doesn't raise risk of rare blood clots
Barclays pays out more than US$1bln to investors as profits rebound
LSH Capital posts 1H earnings jump ahead of LEAP listing

Stories You'll Enjoy