Technics Oil and Gas Ltd (特藝石油), a Singapore-based offshore oilfield services company, aims to raise between S$14 million (US$10.8 million) and S$16 million by selling Taiwan Depositary Receipts (TDRs) on the GRETAI Securities Market after the Lunar New Year.
The move will mark Taiwan’s first TDR issuance on the GRETAI, with other TDRs having been listed on the main bourse.
Technics won approval from Taiwanese regulators to sell 80 million TDRs, each representing 0.5 common shares.
The issuance date and price have yet to be determined. Its stock closed 2 percent lower at S$1 in Singapore yesterday.
Technics is enjoying a lead in the industry because only one other company, which is based in Malaysia, is offering such services in the region, Technics chairman Robin Ting (陳有樹) said in Taipei.
It is tapping into new markets including Russia and the Middle East to complement its existing footholds in Singapore, Vietnam, Malaysia, Indonesia and Thailand, he said.
Technics was recently awarded a contract worth S$23.5 million from a Middle East oil and gas firm to deliver process equipment.
Founded in 1990, it makes compression systems and process modules. This equipment is then integrated with other components to form production and storage facilities for oil and gas development.
Ting said Technics currently has orders worth S$130 million, which will be booked into its revenue depending on project spans that range from four to 14 months.
The firm’s profit in the financial year ending last September rose 165 percent to S$16.4 million, on revenue of S$102.8 million, which was down 21 percent from a year earlier.
Gross profit margin rose to 42 percent, compared with 22 percent in the previous year.
The company has set a threshold that it will bid only for projects offering at least 30 percent profit margins, Ting said, adding the uptrend is expected to continue.
“Technics has the capability to finish fast-track projects, which command a premium and bring about higher margins,” Singapore’s SIAS Research said in a report.
Vietnam is expanding energy resources rapidly and the researcher anticipated Technics would secure orders from that country.
Technics is also looking to expand its presence in the Middle East, Indonesia and Australia, all of which are developing their energy resources, it added.
Meanwhile, the Taiwan Stock Exchange expects to have 20 companies offering TDRs this year, exchange chairman Schive Chi (薛琦) said yesterday.
There are 25 companies trading their TDRs on the local bourse, after an addition of 12 new issuances last year, the stock exchange’s data showed.
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