EOC's FPSO, LEWEK ARUNOTHAI, CONTINUES TO STEER 1H FY10 EARNINGS

 Net profit up 67% yoy to US$16.9m despite challenging environment in the offshore construction sector  Strong recurrent earnings base from FPSO buoys project-driven income from construction vessels SINGAPORE, 9 April 2010 EOC Limited (EOC or the Group), an Asian-based provider of offshore oil and gas support services, has delivered another set of healthy results for its first half year ended 28 February 2010 (1H FY2010) with strong contributions from its first Floating Production, Storage, and Offloading (FPSO) vessel, the Lewek Arunothai. The Group saw its net attributable profit rise 67% year-on-year (yoy) to US$16.9 million from US$10.1 million, on revenue of US$63.0 million which grew 84% from US$34.3 million in the previous corresponding period. This improved performance was despite the challenging environment experienced in the largely short term project driven offshore construction sector. The operations of the Lewek Arunothai also helped lift the Group’s return-on-equity by 3.3 percentage points from 8.8% to 12.1% in 1H FY10. Improvements in the Group’s cash flow and balance sheet also reflect the success of EOC’s strategy to extract more value from its assets. Cash flow from operations increased by 16% to US$34.6 million from 1H FY 09’s US$30.0 million while net gearing improved to 2.0 times from 2.3 times. EOC’s interest cover strengthened to 7.4 times in 1H FY10 against 5.7 times previously. Mr Lim Kwee Keong, EOC’s Chief Executive Officer, said: “Being a global operator of both construction vessels and FPSOs based in this region, we have demonstrated the aptness of our strategy to build strong recurrent income streams with FPSOs and accommodation crane barges whilst capitalising on high-value spot opportunities in the pipe-laying and construction segment with the Lewek Champion. “EOC has shown that we are able to execute challenging construction and production projects well. With our proven track record for safety and delivery, we are confident that our fleet will see healthy utilisation even though competition remains keen in the short term. We also look forward to the delivery of our second FPSO which will add to our recurrent income base and hold the Group on an even keel during market downturns.” EOC’s second FPSO is currently being converted from a Suezmax oil tanker by Keppel Shipyard and is expected to begin production in the second quarter of 2011. Contracted by Premier Oil Vietnam Offshore for the development of the Chim Sao field in Vietnam, this FPSO charter is potentially worth up to US$1 billion for the entire duration of the contract including extension options.