Pacific Radiance trumps expectations with 82% boost in 2Q14 vessel gains

As it enjoyed vessel utilisation rates of 85% at the fleet level.

Pacific Radiance delivered another quarter of strong growth with revenue up 16% q-o-q to USD48.7m, driven by high utilisation in the subsea division. Gains from vessel sales were higher than expected at USD18.1m, driving an 82% q-o-q growth in PATMI to USD32.4m.

According to a report by OCBC, Radiance enjoyed vessel utilisation rates of c.85% at the fleet level, and management continues to target steady improvement over the medium term.

Three vessels joined the fleet in July-August - it expects another six new vessels from today till end-FY14, and there are c.20 vessels in the building programme that will join the fleet in the next two years.

This does not represent absolute fleet growth as we expect USD20m-25m of vessel sales gains per year, or about 4-6 vessel sales per year. There are no purchase options nor obligations on any vessels in Radiance’s fleet, yielding more flexibility in fleet optimisation.

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