Beng Kuang Marine has entered into a conditional land sale and purchase agreement to sell 31% of its Batam shipyard property to PT. Bukit Batu Mulia for $9.89 million.

 

The percentage of the company&rsquo s shipyard amounts to some 100,970 sqm.

 

PT. Bukit Batu Mulia is 51.0% and 49.0% owned by Summit Excellent Enterprises, BVI and George Santos respectively. Summit Excellent Enterprises is associated and affiliated with China&rsquo s Nanshan Group, a large-scale private joint-stock enterprise listed in the Chinese Federation of Enterprises (CFE)' s Top 500 Chinese Enterprises. The group is in the business of aluminium processing, fabric and garment manufacturing and processing, real estate, finance, as well as others.

 

Santos is the founder and owner of the Indonesia Solid Group based out of Batam/Raiu Indonesia and is in the business of mining, shipping, construction, concrete batching, asphalt and stone quarry.

 

The news comes after Beng Kuang sold around 30% of its Batam shipyard property for $8.64 million in April. The sale was made to a subsidiary of Oil States International, a major global provider of integrated energy systems and solutions.

 

In its June 23 statement, the company says it has been &ldquo prioritising cost minimisation and deleveraging initiatives while focusing on monetising fixed assets and high-potential business segments within its core business divisions to create new growth catalysts&rdquo .

 

&ldquo The cash proceeds from both sale transactions of our Batam shipyard property are expected to significantly boost our liquidity resources. Coupled together with the rest of our deleveraging initiatives, it will allow us to stay nimble and agile in navigating through the current rising interest rate environment,&rdquo says Yong Jiunn Run, CEO of Beng Kuang Group.

 

&ldquo More importantly, it provides a stronger financial footing for us to pursue high-growth opportunities within our infrastructure engineering and corrosion prevention business segments where we have an entrenched market position and strong technical competencies,&rdquo he adds. &ldquo We see good business prospects in the marine and offshore industries and the momentum we gained so far underpins our confidence for the year ahead.&rdquo

 

 

 

 

 

 

 

 

 

 

&bull Marine & offshore pedestal cranes are used to facilitate heavy lifting, moving tons of material, equipment and cargo to or from marine vessels, barges and structures

&bull The new marine & offshore pedestal crane contracts are secured under the Group&rsquo s Infrastructure Engineering division, which has registered increased orders for such pedestal cranes in FY2022

&bull Opportunities for the Group to expand its revenue stream from the maintenance and repairs work of such pedestal cranes

&bull Barring unforeseen circumstances, the new marine & offshore pedestal crane contracts are expected to be completed and delivered to the customers in the second half of 2023. As such, the new contracts are expected to have a positive impact on the earnings per share and net asset value per share of the Group for the financial year ending 31 December 2023

 

Mr Yong Jiunn Run, Chief Executive Officer of Beng Kuang Group, said: &ldquo Marine & offshore pedestal cranes are a niche business segment and we have established a good track record and brand name in this area over the years.

 

We are encouraged that some of the new contracts are from new geographical markets that includes India and Middle Eastern countries, where oil and gas activities have been buoyant and it is also testament to our efforts to expand our business presence globally and boost our order book in FY2023.&rdquo

 

- In total, the Group has an order book of approximately S$24 million at 31 March 2023

- The Group&rsquo s FPSO and FSO service and maintenance business under ASOM remained a key performer and continued its strong momentum, registering revenue growth of 31.63%

- Revenue from our CP division, which was largely recurring in nature, increased by 14.0% as the demand for CP services for Singapore and Batam shipyards continued to regain momentum

- Overall revenue dipped marginally due to mainly due to the cessation of IE operations at 55 Shipyard Road as well as lower contribution from deck equipment supplies under International Offshore Equipments Pte Ltd

- Excluding currency translation losses of S$0.29 million, the Group would have registered a profit of S$0.22 million from continuing operations

- Achieved positive adjusted EBITDA of S$1.21 million, where there were lower depreciation expenses recognised in 1Q2023

- Secured agreement to sell approximately one-third of our Batam waterfront property for S$8.64 million

- Secured tenancy agreements to lease out partial of our Batam waterfront property, where the leasing income will contribute positively to the Group in FY2023