Singapore Corporate News - 24 Aug 2007

SembCorp Marine secures US$198m rig order

ORDERS continue to pour in for SembCorp Marine, the world's second-largest builder of offshore rigs.

With the latest order for a US$198 million jackup from Offshore Group Corp, SembMarine's order books have hit a record $8.6 billion.

Of this, more than half, $4.8 billion, was secured this year alone, surpassing all of last year's orders of $3.1 billion by 55 per cent and is even higher than its previous annual orders record of $4.2 billion achieved in 2005.

The latest order is for a Baker Marine Pacific Class 375 deep drilling offshore jackup rig and is the fourth ordered by Offshore Group Corp from SembMarine subsidiary, PPL Shipyard, following its first contract in October 2006.

The second and third units were secured in January and June of this year respectively.

Construction of the jackup is expected to start in the third quarter of this year with delivery scheduled for December 2009.

The rig will be built based on PPL's proprietary designs and will be equipped to drill high pressure and high temperature wells to a depth of 30,000 while operating in 375 feet of water.

It will have accommodation for 120 persons with full catering and other amenities.

Eu Yan Sang earnings down 35% in Q4

TRADITIONAL Chinese medicine company Eu Yan Sang yesterday reported a 35 per cent drop in its fourth-quarter net profit to $2.3 million as a result of higher operating expenses.
This was in spite of a 21 per cent growth in revenue for the three months ended June 30, to $49.2 million.

Eu Yan Sang's operating profit for the quarter, which does not include foreign exchange gains, fair value gains, interest income or interest expenses, fell sharply by 57 per cent to $2.05 million.

The better performance in earlier quarters meant that full-year net profit was up by 2 per cent to $14.7 million, while revenue rose by 12 per cent to $191.5 million.

Operating profit for the year dipped by 8 per cent to $19.4 million. Operating expenses for the year increased by 15 per cent to $79 million.

CapitaLand buys Shanghai site

CAPITALAND has stepped up its presence in Shanghai by securing a commercial site in the Zhabei District for 598.1 million yuan (S$119.6 million).

The purchase was made in a government land auction through an indirect subsidiary, Yorksure Pte Ltd.

The 20,310 sq m site, with a plot ratio of 3.5, will be developed into quality offices and a high-end hotel or service residences. Total gross floor area is estimated at 71,085 sq m.

CapitaLand said in a statement yesterday that the leasehold site, located along West Guangzhong Road in the commercial area of Ling Shi, is in the Shanghai Multimedia Valley.

The Shanghai Multimedia Valley, with a planned total gross floor area of 800,000 sq m, will house a concentrated cluster of high-tech and multimedia-related industries.

The mega project is slated for completion in 2015.

The property group's proposed Zhabei District development, which has a tenure of 40 years for the hotel and 50 years for the offices, will be ready by end-2009 to benefit from the maturing business environment in the area.

C&O Pharmaceutical Q4 profit falls 11.8%

C&O Pharmaceutical Technology has posted an 11.8 per cent year-on-year drop in fourth-quarter net profit to HK$40.82 million (S$7.96 million), mainly due to a significant run-up in distribution costs.

This was despite sales for the three months ended June 30, 2007 rising 74.1 per cent to HK$207.4 million. Q4 earnings per share stood at 6.5 HK cents - down from 7.9 HK cents a year earlier.

On a full-year basis, its net profit plunged 34.3 per cent to HK$77.6 million, although turnover almost doubled to HK$680 million from HK$347.4 million.

The company incurred HK$27 million in Q4 distribution costs - up from just HK$611,000 in Q4 2006. Q4 administrative expenses rose 97.4 per cent to HK$25 million. On a full-year basis, distribution and administrative expenses came to HK$69.7 million (FY2006: HK$3.6 million) and HK$64.9 million (FY2006: HK$30 million) respectively.

C&O attributed its profit fall for FY2007 to various factors, including a one-off inventory adjustment exercise which was completed in the first half. After the acquisition of Shenzhen Liancheng's distribution business, it incurred higher advertising and promotion expenditure which led to the surge in distribution expense, it said. It added that higher staff costs, travelling expenses, sales office rental, professional fees and R&D costs led to the jump in administrative expenses.

Although gross profits were higher in absolute terms, margins were lower because of distribution of third-party products.

Going forward, the group plans to expand its client base to foreign pharmaceutical firms that want to outsource their product and clinical research to China. Its recent business developments include an alliance with Nasdaq-listed Optimer Pharmaceuticals that will see both parties share information on pre-clinical and clinical research work for products in the pipeline, technology transfer as well in-licensing and out-licensing of pharmaceutical products.

C&O also secured an exclusive distributorship for Century Products - a line of multi-vitamins produced by Texas-based Pharmco. The exclusive partnership is effective for up to 10 years, and includes other healthcare products developed by Pharmco.

During the year, C&O launched seven new branded drugs, with another 50 drugs in the R&D stage.

Cosco announces contracts worth US$708.1m

COSCO Corporation (Singapore), a major shiprepair and marine engineering and shipping group, said yesterday that its 51 per cent owned Cosco Shipyard Group (CSG) has secured shipbuilding and conversion contracts totalling US$708.1 million from several international customers.

The contracts cover 16 bulk carriers newbuildings; four jobs to convert product tankers to general cargo carriers; one very large ore carrier (VLOC) conversion; one floating, production, storage and offloading (FPSO) conversion; and two single to double-hull conversions.

The 16 bulk carrier contracts were signed with Greek, Turkish and Liberian customers, and are targeted for progressive deliveries in 2009 and 2010. The conversion contracts were sealed with customers from the US, Taiwan and India, and are expected to be completed in 2008.

The projects will be carried out at Cosco's Zhoushan, Dalian, Nantong and Shanghai shipyards.