At a Glance

• FY09 results beat our above-consensus forecast.

• Strong JV contribution in 4Q boosts bottom line.

• Reiterate BUY, TP unchanged at S$0.92.

Comment on Results

Ezion beats the street. FY09 revenue more than doubled to

S$73.6m, driven by expanded vessel fleet and higher contribution

from its marine services business. Headline net profit was S$17.1m

(+113% y-o-y). Excluding net exceptional loss of S$2.5m, recurring

net profit is estimated to be S$19.6m (+144% y-o-y), beating our

above-consensus forecast. The outperformance was despite

S$1.2m doubtful debt provision, and was mainly due to stronger

than expected JV contributions in 4Q, with commencement of

work on Phase 1 of the Gorgon project. Net gearing increased as

loans were drawn to finance its liftboat newbuilding programme. A

final dividend per share of 0.06 Scts was declared.

First liftboat deployed. Ezion’s first liftboat, the

been delivered and chartered out to Ezra since Jan 2010. It is

currently being deployed to an oil supermajor operating offshore

Africa. The next liftboat is scheduled for delivery in 2Q10.

Potential sale and lease back deal? The group revealed that it

would seek to raise capital from its existing key assets. We believe

this could indicate a sale and lease back (SLA) of one of its liftboats.

With net gearing expected to reach 1.1x by end FY10, an SLA

would be positive, as it would allow capital to be recycled into the

business to pursue other opportunities.Lewek Leader, has

Recommendation

Reiterate BUY. While Ezion disposed a small vessel in 4Q09, the

impact to earnings is estimated to be insignificant. Hence, we

maintain our above-consensus FY10 earnings forecast of S$54.5m.

Our TP remains unchanged at S$0.92, still pegged to 12x FY10 PE.

Near term catalysts could be the announcement of tender results

for Phase 2 of the Gorgon project over the next two months.

Maintain BUY.

No. Not yet.

Now we are in the bear market, not a good time to pick up any stock.

Beside, the chart shows EzionHldg going downward. Not the time to buy.