New order flows ahead for Keppel Corp

Ultra-deepwater is the focus.

Here's more from OCBC:

2013 will still see new orders; ultra-deepwater in focus
In our year-end report on Keppel Corporation last year, we highlighted that order flows for jack-up rigs would slow while prospects for semi-submersible rigs look increasingly brighter.

The year played out as expected, with the group securing three jack-up rigs and nine semi-sub orders so far this year.

Looking ahead, we expect continued new order flow in 2013 due to strong industry fundamentals, including a tightening in the ultra-deepwater segment.

2012 has been front-ended loaded due to property; O&M was relatively stable
Overall, this has been a front-end loaded year as lumpy earnings from the property division boosted net profit in 1H12.

Net profit from O&M remained relatively stable each quarter in 9M12, though operating margin in the division has more than halved from 26.0% in 3Q11 to 12.9% in 3Q12 as margins continue to normalize.

Recall that margins were impressive around the 20+% range from 4Q10 to 4Q11 as high profit margin contracts, secured largely before the crisis, were executed, along with productivity gains.

Improving regional satellite yards
Meanwhile KEP has started to improve the competencies and productivity of its regional satellite yards to meet heavier workload requirements. Increased focus will be placed on productivity and R&D efforts to sustain growth for the future.

This is a good strategy to pursue so that more work can be outsourced to regional yards in the future to free up space in the Singapore yards.

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