Coastal Contracts at lowest since mid-April

KUALA LUMPUR: Share price of COASTAL CONTRACTS BHD [] fell to the lowest since mid-April of RM2.50 at the midday break on Friday, July 15 despite the positive outlook for the company with the latest contracts which increased its book order to RM500 million.

It fell 11 sen to RM2.50. Turnover was 302,900 shares done. The decline in the share price was also in line with the cautious market sentiment, especially from the external headwinds from the US.

The FBM KLCI lost 4.59 points to 1,575.25. Turnover was 308.54 million shares valued at RM482.85 million. Declining stocks beat advancers 346 to 171 while 312 counters were unchanged.

On Thursday, Coastal Contracts announced it had fixed the exercise price for the warrants to be issued at RM3.18 per warrant. The exercise price of RM3.18 was a premium of about 21.84% over the closing ex-all price of Coastal shares after the bonus issue of RM2.61 on the same day.

The warrants were issued free on the basis of one warrant for every eight shares held after the bonus issue.

Maybank Investment Bank Research was positive about the outlook for the company after it won a RM98 million contract to build a maintenance/support vessel and two barges.

“Including the new contracts and after adjusting for revenue recognition from vessels delivered to buyers in the second quarter, Coastal Group has about RM500 million worth of vessel sales orders awaiting delivery to customers up to 2012. The latest contracts have also lifted the group’s year-to-date order wins to around RM430 million,” it said.