Seatrium Limited (5E2) AI Stock Analysis

• Market Cap: $6.92B
• Dividend Yield: N/A
• Average Volume (3M): 16.58M
• Price to Earnings (P/E): 44.0
• Beta (1Y): 1.49
• Revenue Growth: 26.60%
• EPS Growth: N/A
• Country: SG
• Employees: 23,000
• Sector: Industrials
• Sector Strength: 83
• Industry: Aerospace & Defense
• EPS (TTM): 0.05
• Shares Outstanding: 3,411,858,600
• 10 Day Avg. Volume: 10,898,970
• 30 Day Avg. Volume: 16,578,870
• PEG Ratio: -0.93
• Price to Book (P/B): 1.10
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -8.95
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $2.92
• Price Target Upside: 43.88% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

Seatrium Limited shows a promising recovery in financial performance, driven by improved revenue and profitability, although cash flow challenges remain. The technical indicators suggest caution due to potential overbought conditions. The stock is currently overvalued based on its P/E ratio, which may impact investment appeal. Positive sentiment from the earnings call supports an optimistic outlook, but operational challenges in the U.S. need addressing. Overall, the stock is in a recovery phase but must tackle key issues to sustain growth.

Positive Factors

Competitive Position

Seatrium's competitive position in Brazil remains strong and it should be able to take advantage of some of the recent unsuccessful tenders by its competitors.

Contract Wins

Seatrium demonstrated its competitive position by winning Petrobras' P-84 and P-85 FPSO newbuilds, as well as topsides fabrication and/or integration work for the Errea Wittu and Jaguar FPSOs.

Cost Optimisation

Seatrium's cost optimisation efforts and lower financing costs are bearing fruit, resulting in an underlying profit in line with forecasts.

Negative Factors

Downside Risks

There are downside risks including potential cost overruns and project cancellations.

Gross Profit

Gross profit for 2H24 was below expectations due to higher cost allocation to projects and more projects at the engineering stage.

Order Estimates

Seatrium's estimated order wins for the year are lower than previous estimates, reflecting a decrease in expected revenue.

Seatrium Limited Business Overview & Revenue Model

Company Description

Seatrium Limited provides engineering solutions to the offshore, marine, and energy industries. The company engages in the turnkey design, engineering, procurement, construction, and commissioning of offshore newbuilding and conversions, FSOs, FPSOs, FDPSOs, FPUs, MOPUs, gas terminals, FLNGs, FSRUs, Gravifloat, jack-ups, semi-submersibles, drill ships, TLPs, SPARs, and SSP solutions. It is also involved in the dry-docking, repair, refurbishment, retrofitting, life-extension, upgrading, and conversion of offshore and marine vessels and structures; specialised projects, including jumboisation and dejumboisation; and gas carriers, cruise ships, ferries, yachts, floating production vessels, heavy lift vessels, mobile offshore drilling units, tankers, containers, and cargo ships. In addition, the company offers turnkey engineering, procurement, construction, transportation, installation, offshore hook-up, commissioning, and brownfield solutions; high voltage direct current (HVDC) converter stations, high voltage alternating current (HVAC) substations, and wind turbine foundations; and wind turbine installation vessels, floating offshore wind turbines, floating wind-HVDC, and HVAC stations. Further, it provides specialised vessels and solutions comprising ferry, RoPax, and cruise, renewable energy support, offshore support, naval support and security, and research and scientific survey vessels; offshore oil and gas fixed platforms, including integrated production facilities, utility living quarters, and jackets; and onshore LNG and plant modules. Additionally, it engages in bulk trading of marine engineering related products; provision of management, and harbour tug services to port users; and collection and treatment of used copper slag, and the processing and distribution of copper slag. The company was formerly known as Sembcorp Marine Ltd and changed its name to Seatrium Limited in April 2023. The company was incorporated in 1963 and is headquartered in Singapore.

How the Company Makes Money

Seatrium Limited generates revenue primarily through its project-based model, where it secures contracts for the construction and repair of offshore and marine structures. Key revenue streams include the design and fabrication of oil rigs and floating production systems, ship repair and conversion services, and the construction of specialized vessels. The company often collaborates with major oil and gas companies and shipowners, which are significant contributors to its earnings. Additionally, strategic partnerships and long-term contracts play a crucial role in sustaining its revenue flow, as they provide a steady stream of projects and enhance its market presence.

Seatrium Limited Financial Statement Overview

Summary

Seatrium Limited demonstrates a recovery phase with improved revenue and profitability metrics, marking a positive trajectory. The balance sheet is moderately leveraged with a healthy equity base, which is encouraging. However, cash flow generation remains a concern, requiring strategic improvements to ensure sustainable growth. Overall, the company is on a path to recovery, but it must address cash flow challenges to enhance financial stability.

Income Statement

The income statement shows a positive trend with significant revenue growth from 2023 to 2024, increasing by 26.6%. The gross profit margin improved to 3.15% in 2024 from a negative margin in 2023. Net profit margin also turned positive at 1.7%, reflecting improved profitability. However, the EBIT and EBITDA margins are still modest at 2.3% and 9.0%, respectively, indicating room for operational efficiency improvements.

Balance Sheet

The balance sheet reveals a stable equity position, with stockholders' equity representing 36.2% of total assets in 2024. The debt-to-equity ratio is reasonably managed at 0.49, suggesting moderate leverage. Return on Equity (ROE) has improved to 2.47% in 2024, which is a positive sign, though there's potential for further enhancement. Overall, the balance sheet reflects a balanced approach to asset and liability management.

Cash Flow

Cash flow analysis highlights a challenging picture with a significant drop in operating cash flow from 2023 to 2024, resulting in negative free cash flow. The free cash flow to net income ratio is unfavorable, indicating cash flow generation issues. However, the operating cash flow to net income ratio is positive at 0.62, showing some ability to convert income into cash. Improvements in cash management are necessary for financial resilience.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
8.42B	9.23B	7.29B	1.95B	1.86B	1.51B
	Gross Profit
88.39M	290.68M	-209.34M	-141.96M	-1.11B	-491.57M
	EBIT
-45.87M	212.45M	-1.57B	-252.40M	-1.20B	-584.85M
	EBITDA
290.61M	833.52M	-1.27B	101.95M	-954.83M	-327.69M
	Net Income Common Stockholders
-1.72B	156.84M	-2.02B	-261.14M	-1.17B	-582.51M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
806.27M	1.96B	2.27B	2.13B	1.11B	806.27M
	Total Assets
8.97B	17.48B	16.23B	9.10B	9.30B	8.97B
	Total Debt
3.84B	3.12B	3.55B	3.36B	3.35B	3.84B
	Net Debt
3.07B	1.18B	1.28B	1.27B	2.25B	3.07B
	Total Liabilities
5.27B	11.14B	9.81B	5.31B	5.27B	5.27B
	Stockholders Equity
3.67B	6.34B	6.39B	3.77B	4.00B	3.67B
Cash Flow		Free Cash Flow
-434.12M	-4.26M	484.45M	1.01B	-637.23M	-841.52M
	Operating Cash Flow
-300.51M	97.35M	600.80M	1.04B	-589.09M	-749.89M
	Investing Cash Flow
-35.25M	119.91M	654.35M	-26.21M	-44.22M	-88.12M
	Financing Cash Flow
-359.74M	-524.11M	-1.07B	-20.66M	964.16M	1.23B

Seatrium Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2.03
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SG:5E2, the sentiment is Positive. The current price of 2.03 is above the 20-day moving average (MA) of 1.89, above the 50-day MA of 1.99, and above the 200-day MA of 1.91, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 60.43 is Neutral, neither overbought nor oversold. The STOCH value of 94.87 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SG:5E2.

Seatrium Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	64 Neutral	$4.30B	11.88	5.23%	249.82%	4.12%	-10.27%
5E2	59 Neutral	$6.92B	44.03	2.48%	―	26.60%	―

Seatrium Limited Corporate Events

Seatrium Limited Appoints New Chief Financial Officer

Seatrium Limited has announced the resignation of its Chief Financial Officer, Mr. Adrian Teng, effective April 28, 2025, as he pursues personal interests. Dr. Stephen Lu, currently the Executive Vice President for Strategy, will take over as CFO starting April 29, 2025. Dr. Lu brings over 15 years of experience in strategy and corporate finance, with a strong background in the energy and infrastructure industries. His appointment is expected to support Seatrium’s growth and transformation initiatives.

Seatrium Limited Settles EIG Litigation with USD1 Million Agreement

Seatrium Limited has announced the settlement of a legal dispute with EIG Management Company, LLC, which was initially brought against Keppel Offshore & Marine Limited. Following the merger of KOM and Sembcorp Marine Limited, Seatrium took over the litigation and has agreed to resolve the matter by paying EIG a nominal sum of USD1 million. This settlement marks the conclusion of the litigation, potentially stabilizing Seatrium’s operational focus and reducing legal uncertainties for its stakeholders.

Seatrium Limited Appoints New Director to Strengthen Board Expertise

Seatrium Limited has announced the appointment of Mr. Eng Aik Meng as a Non-executive and Non-Independent Director, effective March 1, 2025. Mr. Eng brings over 30 years of experience in the healthcare and maritime industries, with a strong background in private equity investments. His addition to the board is expected to enhance the board’s competencies and skillset, following the departure of Mr. Nagi Hamiyeh. This strategic appointment is likely to strengthen Seatrium’s board and potentially influence its strategic direction, given Mr. Eng’s extensive experience and leadership roles in major companies.

Seatrium Wins Contract for Offshore Drilling Unit with IMI

Seatrium Offshore Technology has secured a contract from International Maritime Industries to supply equipment and a license for a LeTourneau Super 116E Class Self-Elevating Drilling Unit. This contract marks a significant milestone for both companies, as it represents the first new-build construction at IMI’s shipyard and the beginning of a long-term partnership to produce offshore jack-ups in the MENA region. The order aligns with the Kingdom’s Vision 2030, focusing on advanced technology, sustainability, and independence in offshore drilling.

Seatrium and BP Partner for Second Deepwater FPU Project in Gulf of America

Seatrium Limited has signed a Memorandum of Understanding (MOU) with BP Exploration & Production Inc. for a second deepwater Floating Production Unit (FPU) project, known as the Tiber FPU, in the US Gulf of America. This collaboration aims to leverage the technological advancements and lessons learned from their previous Kaskida FPU project to enhance operational excellence. The Tiber project is subject to BP’s final investment decision expected later in 2025, and it underscores Seatrium’s continued partnership with BP, highlighting its strategic role in deepwater asset development.