TAS- the results starting to come in

Background
TAS Offshore Bhd ('TAS') is a small company involved in shipbuilding & ship repair. Its main markets are Malaysia, Singapore & United Arab Emirates.


Source: Company's website

Recent Financial Result

For QE30/11/2013, TAS's revenue increased 65% q-o-q or 60% y-o-y to RM49 million while net profit was mixed; down 15% q-o-q but rose 200% y-o-y to RM7.3 million. The q-o-q increase in revenue was due to sale of 1 unit of tug boat while net profit was lower as the immediate preceding quarter's results had been bumped higher by a reversal of impairment loss of RM3.3 million.


Table 1: TAS's last 8 quarterly results

From the chart below, we can see that TAS's bottom-line & top-line have been rising over the past 2 years. The same goes for its profit margin.


Chart 1: TAS's last 31 quarterly results 

Financial Position


TAS's financial position as at 30/11/2013 is deemed satisfactory with current ratio at 2.4 times and gearing ratio at 0.15 time only.

Valuation

TAS (closed at RM1.24 yesterday) is now trading at a current PE of 9 times (based on annualized EPS of 13.7 sen). At this PER multiple, the stock is deemed fully valued.

Technical Outlook

TAS broke above its downtrend line at RM0.40 in late 2012 (here). It has surpassed its 2009 high of RM0.85.


Chart 2: TAS's weekly chart as at Jan 20, 2014 (Source: Tradesignum)

Conclusion

Based on improving financial performance and positive technical outlook, TAS could be a good stock for long-term investment. I would rate it a HOLD for now after its strong price run-up.

Note:
In addition to the disclaimer in the preamble to my blog, I hereby confirm that I do not have any relevant interest in, or any interest in the acquisition or disposal of, TAS.