Seatrium Earnings: Net Loss Widely Expected; Firm Proposes Share Consolidation

Seatrium's 2023 net loss widened to SGD 1.94 billion from a net loss of SGD 261 million in 2022, largely due to noncash write-downs, provisions for contracts, legal and corporate claims, and merger expenses. We see the net loss as well-guided by management, and we believe investors should focus on the positive outlook ahead. We expect Seatrium to be profitable in 2024 on the back of improved activities, increased efficiency, and the absence of significant one-off items. We therefore keep our fair value estimate at SGD 0.12, and we think Seatrium is attractive currently, with upside to be driven by significant new-order wins. Management will share more information on the outcome of the firm's strategic review on March 15, Seatrium's inaugural Investor Day.