Triyards Holdings reported a 16% YoY rise in revenue to US$63.9m but saw a 14% drop in net profit to US$5.4m in 3QFY15, such that 9MFY15 net profit of US$18.7m accounted for close to 70% of our full year estimate, slightly below expectations. This compares to 60% of consensus’s estimates. Meanwhile, the group also announced US$175m of new order wins for two enhanced BH450 liftboats (excludes owner furnished equipment)

Though lower oil prices could lead to reduction or delay of oil and gas capex, especially for exploration activities, Triyards believes there will be continued demand for its offering, as its main business focuses on fabricating assets involved in construction, production and decommissioning, to inspection and maintenance of infrastructure for existing oil fields. Net gearing was low at 0.3x in 3QFY15. Pending an analyst briefing later, we maintain our BUY rating but put our fair value estimate of S$0.60 under review.

Source: OCBC Research - 8 Jul 2015