Swissco looking at fleet expansion

Swissco Holdings Limited has announced its financial results for the three months/full year ended 31 December 2013.

Financial highlights of the results and future plans:

• Revenue edged up 4.3% y-o-y to record high of $114.7 million on organic growth in core businesses
•  Proposed first and final dividend of 1.0 cent per share; comprised of ordinary and special dividends of 0.5 cents each
•  Group to spur growth through acquisition, strategic alliances as well as further enhancement of its fleet

Group’s revenue was at a record high of S$114.7 million in FY2013, up 4.3% y-o-y compared to S$110.0 million a year ago. This was mainly due to an increase in revenue contribution of S$5.2 million from both core Maritime Services and Vessel Chartering segment, partially offset by a decrease of S$0.5 million in revenue, down from S$4.6 million in FY2012, from ship repair in FY2013.

The Vessel Chartering segment registered higher revenue in FY2013 than the previous year as a result of higher charter rates from new higher value vessels added to its fleet during the year.

Although there was a decent improvement in FY2013’s Revenue, Gross Profit only increased marginally by 1.9% y-o-y to S$31.4 million due to higher crew and maintenance costs. This resulted in a lower Gross Profit Margin of 27.3% in FY2013, down from 28.0% a year ago.

Other net gains in FY2013 recorded earnings of S$3.9 million as compared to a net gain of S$0.9 million in FY2012. This gain is due largely to strategic disposal of vessels as part of the Group’s fleet renewal program, partially offset by loss on disposal of financial assets and foreign exchange loss.

Administrative expenses fell marginally by 2.4% to S$9.1 million in FY2013 from S$9.4 million in FY2012, mainly due to the absence of a S$0.2 million provision for impairment of trade receivables as well as a write back of S$0.1 million during FY2013. Finance expenses also decreased by 29.7% to S$2.2 million due to the Group’s continuous effort to refinance part of their loan at a lower interest rate.

Consequently, net profit after tax for the Group surged 41.5% to S$23.2 million in FY2013, translating to basic earnings per share of 5.34 cents.

Mr. Alex Yeo, Chief Executive Officer of Swissco stated: “We are pleased to announce that Swissco has once again secured a positive set of results and to reward our loyal shareholders for their long-term support, the Group is proposing a dividend of 1 cent; comprised of ordinary and special dividend of 0.5 cents each. With the outlook of global E&P spending set to remain positive we expect charter rates and demand for our vessels to remain stable.

As such, we will continue to enhance our fleet capabilities through our fleet expansion and renewal program to better meet market demand. Apart from the Vessel Chartering segment, we expect our Maritime Service and Ship Repair segments to continue to contribute to our FY2014 earnings. In order to further unlock shareholder value, we will continue to actively seek to establish strategic alliances in new markets to propel the growth of our existing business. We will also seek acquisition opportunities to broaden and diversify our earning base.”