About The Company
South East Asia Marine Engineering & Construction (SEAMEC), with four vessels, provides offshore support to petroleum exploration and production companies, in India and abroad. It is a subsidiary of Coflexip Stena Offshore (Mauritius) Ltd, which is owned by Technip.S.A. France.
The positive about Seamec is that it has a small fleet of just four vessels and hence deployment is easier. In 2009, as against last year, all the four vessels have been hired as of now. The company expects no dry docks for the year, and there are no cancellations as of now. There is no dry-docking in 2009, only one ship in 2010.
About The Results
The company has posted the results and had managed to finally turnaround in the fourth quarter ended 31st Dec 2008. And it has continued with his good performance into first quarter ended 31st March 2009. This consistent spurt in performance has been because in the previous year only two of the four vessels were employed, resulting in increase in net profit during the current period. And this small fleet has helped the company do exceedingly well. For Q1CY09, though the net sales of the company was down 4% on a QoQ, lower operating expenses helped the company post a 13% jump in net profit. But the best part was the profit margin OPM was at a very healthy 69.47% compared to 59.30% in Q4CY08. NPM was at 61.88% vis-à-vis 52.27% in previous quarter.
One of the overseas charter contracts was prematurely terminated in July 2007, due to delay in payments. As per the terms of payment agreed with the charterer, the company has since recovered Rs.19.48 crore against the total outstanding of Rs.25.18 crore from the charterer, the balance amount is receivable on or before June 30, 2010. The charterer has since paid interest @ 8% for the half year ended December 31, 2008 on the balance amount, as per terms of the contract. The balance amount is expected to come in before first half of 2009. The company has recently received a one-year contract for Seamec II, though at lower rates, while it has also received a two-month contract for Seamec Princess, starting May 15, 2009.
About the Stock
The stock touched a new high at Rs.161 on 26th May’09 and since then has now settled down at Rs.160 levels. The stock could be traded for short period but any long term investment in this stock is not suggested.
Disclosure: I do not have any personal holding in this stock.
