Dyna-Mac, Ley Choon clinch new contracts; Dyna-Mac posts S$33m net loss for Q3

OFFSHORE oil and gas contractor Dyna-Mac on Monday said it has secured fabrication projects for a total provisional sum of S$157.5 million.

These contracts are for the fabrication of pipe spools and construction of topside modules for floating production storage offloading vessels, it said. The projects begin in the fourth quarter of this year and are expected to be completed by the second quarter of next year.

Meanwhile, the contractor has received a notice of cancellation of contract by an existing customer. The contract is valued at S$6.3 million against an awarded project announced in April 2020 for the fabrication of an offshore vessel's upper hull sections. Talks with the customer on the contract resolution and settlement are ongoing.

These orders are not expected to affect the group's earnings per share and net tangible assets materially for the current fiscal year ending next month.

Dyna-Mac posted a net loss of S$32.6 million for its three months ended September, versus a profit of S$142,000 a year ago. This was mainly due to the provision for unavoidable costs of fulfilling certain construction contracts with customers, which exceeded the economic benefits expected to be received, coupled with provision for slow-moving inventories, it said.

Revenue fell by 92.7 per cent to a mere S$2.6 million, from S$36.2 million the year before, mainly due to the slower progress of the projects, it said.

Separately, construction firm Ley Choon Group announced that it has clinched three contracts worth S$33.75 million in total for underground services installation and construction works.

The contracts are not expected to have any material impact on its earnings or the net tangible assets for the current financial year ending March 31, 2021, it said.