Ezion hits 22-mth low, leads oil-related stocks down in Singapore

OFFSHORE and marine counter Ezion Holdings has taken a further beating on weaker global oil prices, with its share price falling to a 22-month low on Friday.

Ezion, which specialises in marine logistics and support services to the offshore oil and gas industries, sank to S$1.31 a share - the lowest since February 2013. At 9.58am, Ezion shares were trading around S$1.335, down seven cents, or five per cent, with more than 15 million shares changing hands.

Meanwhile, the FT ST Oil and Gas Index fell almost two per cent - the lowest since January 2012 - in line with weaker crude oil prices after Opec decided against cutting oil output despite a huge oversupply in world markets.

Diversified marine conglomerate Keppel Corp also weakened, with its shares trading down 15 cents, or 1.6 per cent, at S$9.05 each on about four million shares.

Oil prices have slid to a four-year low, hurting energy and oil-related companies. In part because increasing shale gas production in the US has contributed to an oversupply of fuel, oil prices have fallen by about a third since June.

Sentiment over Ezion has been dampened by concerns over its gearing, exposure to US dollar-denominated loans and increasing rivalry in its core operations.

As at end-September 2014, Ezion has about US$1.2 billion in total borrowing and debt securities repayable after a year, while its cash and cash equivalent stood at around US$333 million. The company has also been issuing debt to fund its expansion, further fuelling concerns over whether its balance sheet may be over-stretched.