KUALA LUMPUR (Feb 25): Offshore support vessel (OSV) provider Icon Offshore Bhd has clinched six out of the eight packages being offered by Petronas Carigali Sdn Bhd under the latter's umbrella contract for the provision of the spot charter of marine vessels.
In a press statement today, Icon Offshore (fundamental score: 0.95; valuation score: 0.90) announced its wholly-owned subsidiary Icon Offshore Group Sdn Bhd had recently received a Letter of Award (LoA), which include the provision of marine vessels in the categories of anchor handling tug/supply, vessel, straight supply vessel, platform supply vessel, utility vessel, workboat and work barge.
The umbrella contract is expected to contribute positively to the earnings and net assets of Icon Offshore for the financial year ending Dec 31, 2015 and beyond, it said in a statement with Bursa Malaysia today.
Icon Offshore expects the contract to bolster its orderbook, which currently stands at RM760.2 million.
Its CEO Jamal bin Yusof said in the press statement that the umbrella contract has only been awarded to 21 players in the sector, which make up approximately 20% of the contractors operating in the Malaysian industry.
“This will ensure that for the next three years, including the one year option period, all spot contracts from Petronas (Carigali) will only be awarded to these 21 players,” Jamal added.
The umbrella contract stipulates the usage on demand of Icon’s vessels that fall within the six specified packages within the contract period and will require the company to provide the vessel, crew and associated equipment for a continuous 24-hour operation, it said.
The umbrella contract runs immediately and shall continue for a primary period of two years, with an extension option of one year.
In 2014, Icon Offshore has taken delivery of a new accommodation work boat and an anchor handling tug and supply vessel, bringing its current fleet to a total number of 31 vessels, with seven more to be delivered by 2016, according to the statement.
Jamal added, “It is our hope that the awards of these new contracts, as well as other positive signs we are seeing around the industry, are an indication that the oil and gas markets have finally begun moving towards normalising, albeit at a gradual pace.”
Icon Offshore dropped 0.5 sen or 0.63% to settle at 79 sen, translating into a market capitalisation of RM941.75 million.
(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)