Is Marco Polo Marine (SGX: 5LY) worth checking out?
$MarcoPolo Marine(5LY.SI)$ - Gearing Up for an Offshore-Wind Inflection
📊 1QFY25 Snapshot
Revenue slipped 11 % YoY to S$25.8 million, but tighter cost control lifted gross margin to 41 %, limiting the gross-profit decline to 9 % at S$10.6 million. Ship-chartering utilisation ticked up to 71 %, while the Batam ship-repair yard stayed busy at 83 % utilisation, demonstrating operational resilience even amid softer third-party charter demand.
🚢 Offshore-Wind Assets Coming Online
The purpose-built MP Wind Archer Commissioning Service Operation Vessel (CSOV) is on track to begin a multi-year charter in Taiwan by 2H FY25, alongside three new Crew Transfer Vessels (CTVs). Management expects these additions to lift group EBITDA materially from FY26 as Asia’s offshore-wind build-out accelerates and charter rates firm up.
🏗️ Drydock 4 Capacity Upside
A new 6,000-dwt drydock in Batam set to open in February 2025 is expected to expand repair capacity by roughly 25%. Maiden contributions should flow from 2H FY25, with full-year benefit from FY26 as larger hulls and green-retrofit projects drive higher margins.
🤝 Insider Buying Signal
Non-executive director Darren Teo acquired 1 million shares on 13 May at S$0.044, nudging his direct and deemed stake to 16.46%. The purchase, coming after a 48% three-year share-price climb, underscores insider confidence in near-term growth catalysts.
🛠️ Peer Benchmarking
Giant yard $Seatrium Ltd(5E2.SI)$ just swung back to profit on a record S$17.4 billion orderbook - nearly half of it renewables-linked - while another small-cap yard operator $ASL Marine(A04.SI)$ is rebuilding its S$300 million orderbook after a debt-restructuring exercise, but still carries high gearing and thinning margins.
Against these peers, Marco Polo’s “designer-builder-owner-operator” model keeps more margin in-house and, with a net-cash balance sheet, offers agility that highly leveraged rivals lack.
💸 Balance-Sheet Strength & Valuation
Net cash stands at around S$35.8 million at end-FY24, fully funding vessel and yard expansion without equity dilution.
At around S$0.043, the stock trades near 4.8x FY24 EV/EBITDA and 0.8x NAV—still undemanding versus regional offshore-service peers averaging 6-7x and 1.0x respectively.
📈 Conclusion
With new offshore-wind vessels and additional yard capacity set to kick in from 2H FY25, Marco Polo Marine offers significant exposure to Asia’s energy-transition build-out, supported by a net-cash balance sheet and clear insider conviction.
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