Decent results, promising growth

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consensus estimate3Q13 earnings slightly better than our above

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by lower JV and other incomeGross margin outperformed impact partially offset

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delivered in 3Q, three more by DecSome delivery rescheduling two service rigs were

? Maintain BUY with TP raised slightly to S$2.65

2Q results beat expectations

3Q13 results above.

y and 5% q-o-q to US$38.2m, bringing 9M13 net profit to

US$102.9m, or 73% and 77% of our and consensus? FY13

estimates. Growth was driven by fleet expansion,

commencement of three LNG projects at Curtis Island and

margin improvement. We are impressed with the 1.9ppt q-o-q

gross margin expansion to 48.2%, though impact on the

bottomline was partially offset by lower JV and other income.

Net gearing is manageable at 1.05x as of end Sept.Ezion?s 3Q13 net profit surged 137% yo-

Fleet to reach 18 rigs by Dec FY14/15F EPS raised by

3/2%.

in Myanmar and Mexico in 3Q - and three more units are

expected to come onstream by end Dec (for Caspian Sea, India

and Middle East), bringing its total fleet to 18 vessels (double

that of 9 in early 2013). Management indicated during the

briefing that 3 liftboats and 1 refurbished jackup rig are

experiencing delays of 3-6 months due to external factors. In

addition, service rig #11 will be off hire for about 5 months for

an upgrade requested by customer. We have adjusted our

revenue recognition accordingly. Nonetheless, after factoring

positive impact from higher margins, lower tax and interest

expense, our FY14/15F EPS are lifted marginally by 3.0%/1.6%.Ezion took delivery of two service rigs - for deployment

BUY, TP adjusted to S$2.65,

EPS. Current valuation is undemanding and we believe Ezion?s

strong earnings growth (2-year CAGR of 42% in FY13-15) and

contract wins will drive the stock price further. Maintain BUY.based on 14x revised FY13/14F