Ezra Holdings maintains revenues but profits well downCompany News // July 10, 2015
Ezra Holdings Limited has reported a marginal reduction in revenue in the three months ended 31 May 2015 compared to the same period a year ago. Revenue in the nine months ended 31 May 2015 also experienced a marginal 3 per cent decrease to US$1,013.7 million, compared to the same period a year ago. However, a statement released by the company also showed that profit after tax fell by 96 per cent in the quarter and by 60 per cent for the nine month period.
Lionel Lee, Ezra’s Group CEO and Managing Director, said: “Despite recent market challenges, Ezra has managed to maintain its revenue this quarter. We acknowledge that market conditions remain difficult, but we see that the longer-term prospects in the industry are showing gradual improvement. The group is currently working to rationalise non-core assets to accelerate the deleveraging of and strengthening the balance sheet.”
“We continue to win projects across the group, with total contract wins in excess of US$800 million, including options, in the past three quarters. We feel that we are in a better position to ride through the tough market conditions, after implementing successful cost efficiency initiatives.
"At the same time, as we said earlier this year, we will continue maintaining our cost discipline to improve margins and shareholder value,” said Mr Lee.
“In addition, we have no more material capital expenditure with Lewek Constellation now fully operational and working in the Gulf of Mexico. We can thus focus our efforts on cash flow generation moving forward.”
At a recent Extraordinary General Meeting (EGM), the group gained shareholders’ approval to raise approximately US$150 million from a rights issue and approximately S$200 million (approximately US$150 million) from a convertible bonds issue.
The gross proceeds from the rights issues will be primarily used to lower net gearing by approximately 18.2 per cent and deleverage the group’s balance sheet. The option for a convertible bonds issue provides an added alternative.
The group’s backlog stands at approximately US$2.0 billion, the majority of which is expected to be executed over the next 24 months.