3Q results review:

- Revenue grew 25.3% yoy (10.1% qoq) to S$79.2 million due to higher sales
achieved by subsidiaries.

- Gross profit margin increased by 5.3 ppt to 20.0% in 3Q08 due to higher margin business contributed by subsidiaries, particularly Oceanic Offshore Engineering Pte Ltd. (owned 80% by the group), a specialist for rigging and testing of wire ropes and related services.

- Its associate, SSH, continued to deliver consistent results, contributing S$2.0 million while its joint venture company in Qatar made a satisfactory progress by reversing previous loss of S$665k to profit of S$69k.

Forecast revision:

- WestComb revised 8% down for FY08 sales and 30-45% drop in FY09-FY10 on the heels that oil and gas industry is facing a challenging cyclical downturn.

- Nevertheless, they adjusted up gross margin by 175 basis points in FY08, 125-150 basis points for FY09 and FY10 due to better sales mix.

- Increased profit share of minority interest, from S$0.6 million to S$1.5 million due to higher contribution from Oceanic Offshore Engineering.

Target Price S$0.140