For its 1HFY2025 ended June, Pacific Radiance reported revenue of $24.37 million, up 27.9% y-o-y. Gross margins improved from 33.3% to 49.1%, as the company was able to gain efficiency in general and admin costs with a bigger scale while commanding higher charter rates.
Adjusted patmi, which takes into account deferred tax and loan writeback, was $6.2 million, a swing from losses of $511,000 in the 1HFY2024 period.
In 1HFY2025, the company deployed three new vessels, which helped to support revenue growth.
Chew observes that demand remains robust for offshore support vessels due to production targets in the Middle East, demand from Asian offshore wind deployment, and the limited number of vessels ordered.
See also: UOBKH's Cheong raises target price for Marco Polo Marine to 8.8 cents
"We believe Pacific Radiance has hit steady state in earnings. The key vessel, accommodation barge Crest Station 1, has locked in multi-year contracts in the UAE.
"Growth will be muted without the acquisition of new vessels or the revival of laid-up vessels," he says.
For the current 2HFY2025, Chew expects new earnings contribution from the completion and sale of two crew transfer vessels.
"Demand for crew transfer vessels remains healthy, although a lull may occur in Taiwan due to the delayed construction of offshore wind farms," he says.
Nonetheless, he expects demand to resume from 2027, with South Korea as an added driver.
In addition, ship repair demand is healthy with the ageing of offshore support vessels globally and higher charter rates from AHTS and workboats could support growth in 2026.
Pacific Radiance shares gained 10.45% to change hands at 7.4 cents. This is the third most active counter thus far today.
