News

ASL Marine Offers 50 Million Shares At $0.21 Each

Proceeds to be used to finance construction of floating dock in Batam, fleet renewal, among others

Singapore - 5 March 2003 - ASL Marine Holdings Ltd ("ASL Marine"), an integrated marine company with facilities bases in Singapore and Batam, Indonesia, today launched its initial public offering (IPO) of 50 million shares at $0.21 each in conjunction with its proposed listing on the Mainboard of the Singapore Exchange Securities Trading Limited.
 
Of these 50 million shares, 10 million shares are available for public offer; 40 million shares for placement, including 3 million shares reserved for employees, business associates and others who have contributed to the success of the Group. The IPO will generate gross proceeds of $10.5 million.   
 
The IPO represents about 25% of ASL Marine's enlarged share capital of 198 million shares. The offer price of 21 cents per share is at a price earnings ratio of 4.39 times based on the historical net earnings per share for the financial year ended 30 June 2002 and pre-Invitation issued share capital of 148 million shares.
 
The IPO, managed by UOB Asia Limited, opens on 5 March 2003 and closes at 12 noon on 13 March 2003. Trading of ASL Marine's shares is scheduled to commence on 17 March 2003.

Use of Proceeds

According to ASL Marine, out of the net proceeds of close to $9million, approximately $4.5 million will be used to finance the construction of a 4,500-tonne floating dock for PT ASL shipyard, which is expected to be completed in early 2004.  Approximately $3 million will be used for fleet renewal such as the acquisition of new vessels and/or the upgrading of existing vessels, and the balance will be used for working capital purposes and/or possible mergers, acquisitions or joint ventures.

Business Overview

ASL Marine is an integrated marine company which is principally involved in shipchartering, shipbuilding, shiprepair and other marine related services, catering to customers mainly from Asia Pacific, South Asia, the Middle East and Europe.

The Group's customers include customers from the offshore and marine infrastructure, shipping, port operations, and other sectors/industries, with orders from repeat customers accounting for more than 90% of the Group's revenue for each of the last two financial years.  Several of ASL Marine's major customers include PSA Marine (Pte) Ltd, PT Karimun Granite, PT Agus Suta Lines, Boskalis International (S) Pte Ltd, TOA-JDN (PUT) Joint Venture, and Dredging International Asia-Pacific Pte Ltd.

Shipchartering

ASL Marine is positioned as an established provider of tugboats and barges. Operating actively in Southeast Asia, the Group has carved out a niche position as a significant player in the transportation of granite and other resource materials largely for the offshore and marine infrastructure sector which include offshore/marine activities such as dredging, land reclamation, seabed leveling, construction of ports, storage depots, quay walls and docks, offshore oil and gas, sewage, water and other pipeline/tunnels, coastal and riverbank protection, breakwaters, and underwater cables.

One such project undertaken by the Group is in respect of the West Natuna Transportation System under separate contracts with Boskalis International (S) Pte Ltd and PT Idros Services.

"We have vessels currently deployed in Asia Pacific, South Asia and the Middle East and we will continue to tap the growing market for shipchartering services for tugboats and barges in the offshore and marine infrastructure and other sectors/industries to diversify our business and geographical reach," said Mr Ang Kok Tian, ASL Marine's Chairman and Managing Director.

As at 24 January 2003, the Group has a charter fleet of 96 vessels, comprising 42 tugboats and 54 barges, and for FY2002, the fleet had utilisation rates of 91% for tugboats and 86% for barges.

Shipbuilding and Shiprepair

From its two shipyards in Singapore and Batam, ASL Marine specialise in building vessels of up to 110m in length and other floating structures and undertakes a wide range of repair works. 

The Group believes that some of the demand for newbuildings will come from the demand for offshore support vessels and/or replacement requirements for ageing vessels. In addition, as ports and/terminals place more emphasis towards more stringent safety and performance standards on vessels, the Group believes its experience in constructing reliable, powerful and maneuverable tugboats will continue to generate opportunities for ASL Marine's shipbuilding business.

"With our shipyards strategically located in Singapore and Batam, which are near main regional and international shipping lanes as well as our ability to attain further costs efficiency from the rationalisation of operations between our Singapore and Batam shipyards, we believe that ASL Marine may continue to maintain a stable share of the shiprepair market and enjoy cost benefits by tapping the generally-lower labour and operating costs in the Batam shipyard," Mr Ang added.

In addition, ASL Marine's Singapore shipyard has drydocking facilities and utilises a mobile boat hoist Marine Travelift? 800CMO with a lifting capacity of approximately 800 tonnes that enables ASL Marine to optimise land use. 

For the financial year ended 30 June 2002, ASL Marine completed the construction of 50 vessels.   

Growth Strategies

With the completion of the floating dock in Batam in 2004, this will upgrade the shipyard's capability to build and repair larger vessels. The floating dock is expected to have a maximum lifting capacity of about 4,500 tonnes.

"While we are now a niche player specialising in the building and repair of tugboats and barges of up to approximately 110m in length, we intend to build and repair larger vessels and broaden the range of vessels that we build and/or repair to include offshore support vessels, general cargo, bulk carriers and dredging vessels," commented Mr Ang.

ASL Marine will also explore joint ventures and/or strategic alliances with existing customers, as and when such opportunities arise.  This will enable the Group to tap into the existing networks of customers and routes that they service.

"We will also actively explore opportunities in other sectors such as the offshore oil and gas industry, and in line with this, we intend to expand our existing fleet of tugboats and barges.  We will also be marketing our shipchartering services more extensively in other countries, namely the Middle East and other parts of Asia such as India, the PRC and Australia," said Mr Ang.

 "Our Batam shipyard has allowed us to benefit from cost advantages and going forward, we will consider having shipyard and other marine operations in other countries that present additional cost and geographical advantages."

Financial Highlights

For the financial year ended 30 June 2002, ASL Marine achieved approximately $64.6 million in revenue and approximately $7.1 million in net profit after tax and minority interests.

As at 24 January 2003, the Group has secured orders comprising approximately $44.8 million for its shipyard business and approximately $10 million for its shipchartering business.

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