Vard Holdings Limited’s (VARD) 1Q14 revenue declined slightly by 2.7% YoY to NOK2.67b, or 21.3% of our FY14 forecast. PATMI slumped 51.1% YoY to NOK92m, forming just 15.5% of our full-year estimate. Although we expect a much stronger 2H, this set of earnings still came in below our expectations. We believe VARD’s Brazilian shipyards continued to rake in losses during the quarter.

On a positive note, VARD managed to secure a very large order intake of NOK5.53b (eight vessels) in 1Q14, thus boosting its order book value to NOK21.84b as at 31 Mar 2014. Nevertheless, management cautioned that this round of order wins should be considered as exceptional. We will provide more details after the analyst briefing later. Our Hold rating and S$0.84 fair value estimate is under review.

Source: OCBC Research - 29 Apr 2014