PAE eyes Bt720m from renewed Chevron deal
Play
PAE has renewed its service contract with Chevron (Thailand) Exploration & Production Co for three years.
PAE expects revenue of more than Bt720 million from the deal. Revenue growth is targeted at a minimum of 20 per cent over the next three years.
It also hopes to secure a new contract worth more than Bt1 billion, which would double its backlog.
Managing director Ratanaphon Wongnapachant said yesterday that operating results would be better this year than last year thanks to high profit margins and new jobs not requiring investment, which should contribute to improved liquidity.
The firm provides fully integrated engineering design service for the oil, natural-gas and petrochemical industries as well as factory electricity systems and non-destructive testing work.
Under the renewed contract with Chevron, PAE will provide service relating to the design and construction of metalwork and pipes, personnel management, materials, tools and equipment, and installation at Chevron’s oil-drilling platform.
PAE has 16 years of business relations with Chevron (Thailand). In the past, PAE earned about Bt20 million a month in revenue from servicing Chevron, so it expects to reap at least Bt720 million from this latest three-year service contract with Chevron.
PAE is also waiting for the bidding result for a major project worth more than Bt1 billion, which should be known in a month or two.
Its backlog of contracts has reached about Bt1.6 billion, of which more than Bt500 million will be booked as revenue this year.
As for this year’s operating results, PAE hopes to revert to net profitability, partly from contracts in-hand (unrealised revenue) relating to the oil and gas business, where the net profit margin is typically higher than the general construction business.
