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    Record earnings; more newbuilds for Jaya Holdings

    News // September 12, 2002
    Buoyant offshore business and demand for fleet renewal lifted Jaya Holding's full-year earnings to a record $25.1 million, said Jaya Holdings, releasing details of its financial performance in the period ending 30th June 2002.

    Jaya said that its net profit for the year ended June 30 was up 43 per cent from 2001 on a marginal rise in turnover to $77.5 million.

    The company has proposed a dividend of 13 per cent or 1.3 cents a share, which with its interim dividend of 7 per cent, or 0.7-cent a share, makes for a total payout of 20 per cent or two cents a share.

    Strong chartering demand in the offshore marine sector and newbuilding interest from fleet owners resulted in the take-up of 17 vessels from 26 in Jaya's three-year, newbuilding programme initiated last March.

    Nine vessels have confirmed charters at a hire rate of US$37,252 per day, while eight have been sold for a total of $75 million.

    Robust oil prices are a key to strong offshore vessel demand, while an ageing global fleet is an important counterbalance to any slide in oil prices that would have an adverse effect on exploration.

    "The need for efficient and modern vessels to meet increasingly stringent safety and performance standards is getting more acute," said Jaya managing director Pang Yoke Min.

    "Even if oil prices should drop tomorrow, for the yards we still have this renewal work that is ongoing, and I think that would keep us busy for the next three to five years."

    Jaya's full-year revenue contribution from offshore shipping rose to 48 per cent from just under 39 per cent previously, while conventional shipping's share shrank to just over 25 per cent from almost 36 per cent as seven vessels were sold.

    Shipbuilding activity remained virtually flat at 26 per cent of total turnover.

    Continuing offshore demand has also stimulated the need for another newbuilding programme, with Jaya announcing a $155 million eight-vessel fleet expansion to be completed during FY2003 and FY2004.

    The eight vessels include six anchor-handling tug-supply vessels and two accommodation cum work barges.

    With the company's Singapore and Batam yards already at full capacity for the next 15-18 months, Mr Pang said, seven of the newbuildings will be outsourced to shipyards in China for steel fabrication and hull construction.

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