Icon Offshore bags vessel contracts worth RM55m

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KUALA LUMPUR (July 14): Icon Offshore Bhd, which is 42.2%-owned by Ekuiti Nasional Bhd, has bagged two long term contracts worth RM55 million from an oil major to supply two anchor handling tug/supply vessels (AHTs).

In a filing with Bursa Malaysia today, Icon Offshore said its wholly-owned subsidiary Icon Offshore Group Sdn Bhd has received two letters of award for the proposed jobs.

Under the contracts, the company is required to provide among others, transportation of supplies from supply bases to drilling rigs/platforms and vice-versa to the oil major.

"The long term contracts shall be effective from July 5, 2015 and shall continue for a period of two years, with an option for an extension of one year," Icon Offshore added.

It said the value of RM55 million is inclusive of the extension period, and is expected to contribute positively to the group's earnings and net assets for the financial year ending Dec 31, 2015 and beyond.

"The risks associated with the contracts are mainly operational risks, such as accidents and unexpected breakdown of vessels. In mitigating such risks, Icon Offshore carries out routine dry docking inspections, afloat repairs and regular maintenance, based on the group’s comprehensive preventive maintenance programme," it added.

Icon Offshore shares sank by 78.9% to close at an all-time low of 39 sen yesterday, since its initial public offering on June 25, 2014, which was issued at RM1.85.

With the sharp fall in share price, it has lost some RM1.717 billion in market capitalisation to date.

As at noon market break today, the stock gained one sen or 1.28% at 40 sen, giving it a market capitalisation of RM464.98 million.