Ezion Holdings reported a 24.9% YoY rise in revenue to US$104.6m and a 106.6% increase in net profit to US$83.7m in 4Q14, boosted by a US$34.9m disposal gain in the quarter. Stripping that out, recurring income was US$48.8m in 4Q14. This brings full year core income to US$189m vs. our estimate of US$190m, in line with our expectations.

Gross profit margin in the quarter remained healthy at 50.6% compared to 51.0% in 3Q14 and 48.7% in 4Q13. Looking ahead, management will focus on growing its service rig division to support its customers to better cope with the current environment. Pending an analyst briefing later in the morning, we maintain our BUY rating but put our fair value estimate of S$2.04 under review.

Source: OCBC Research - 16 Feb 2015