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SEE HUP SENG LIMITED
Annual Report 2012
4
Chairman’s Message
term prospects of Asia’s petrochemical industry, See
Hup Seng also formed a joint venture last year to build an
Integrated Chemical Hub in Singapore to offer toll-blending,
chemical warehousing and logistics services. We have a
51% stake in this joint venture.
During FY2012, the Group also evaluated opportunities
to participate in the upswing of the property market in
Singapore as well as the long-term prospects of the offshore
oil and gas sector.
In May 2012, See Hup Seng took a 30% equity stake in a
joint venture that is developing Heron Bay, a 17-storey deluxe
executive condominium (EC) in Upper Serangoon View. This
project is expected to yield a total of 394 units with total
saleable floor area of around 502,000 square feet. Heron
Bay is the first EC to feature large 5-bedroom units and
luxurious features such as private pool-cum-jacuzzi/garden/
fish pond ensuite to the living rooms of ground-floor units,
complimentary Fibre Broadband Service during the first year
of occupancy, hydrocavitated water swimming pool, among
others. To-date, over 97% of the residential units has been
sold. The development is expected to obtain temporary
occupation permit in 2016.
In addition, the Group invested in a minority stake in
Energy Drilling Pte. Ltd. (“Energy Drilling”), an offshore
drilling company, in April 2012. To-date, Energy Drilling has
commissioned COSCO (Guangdong) Shipyard Co. Ltd. to
build two self-erecting drilling tender barges for delivery in
mid-2014 and one semi-submersible tender rig for delivery
in June 2015.
We believe that by taking minority stakes in the aforesaid
investments, the Group will potentially stand to benefit from
diversified income streams in future without excessive risk
exposure.
Prospects
Looking ahead, business conditions are expected to remain
challenging as a cloud of uncertainty continues to hang over
global markets. Industry competition is anticipated to remain
intense while business visibility continues to be limited until
the global economy is firmly on the path to recovery.
Nonetheless, the Group will continue working on its business
initiatives to deliver a profitable performance in FY2013
barring any unforeseen circumstances.
Our RP business will continue to intensify its marketing
efforts for our broad range of petroleum products in the Asia
Pacific region. Similarly, the completion of the acquisition of
Axxmo is envisaged to provide incremental revenue to the
RP business in FY2013. With respect to the development
of an Integrated Chemical Hub, we are in the process of
extending the lease of the property.
Our RP business will continue to pursue organic growth
through expansion of market reach and product range, as
well as by moving up the supply chain. We will also consider
suitable acquisitive opportunities that can add value to our
existing RP business as and when they arise.
As for our CP business, we aim to achieve steady market
share and sales, as well as to sustain our leading position
in Singapore through constant emphasis on service quality
and cost competitiveness. We will continue to improve our
business processes, retain and strengthen relationships
with existing customers while seeking new customers to
increase the diversity of our revenue base. As we work
towards maintaining efficient and cost-effective operations,
the Group believes the CP business is well-positioned
to remain competitive in providing corrosion prevention
services in Singapore.
Our strategic ventures into property and offshore drilling
businesses are not expected to have a significant impact on
the Group’s financial results in FY2013.
Appreciation
On behalf of the Board, we wish to thank our shareholders
for your support of See Hup Seng. I also wish to express
my appreciation to the Group’s management and staff for
their dedication and hard work in sustaining and growing
the Group’s businesses. I would like to thank my fellow
directors for their guidance and contributions, and our
valued customers, bankers, business partners and suppliers
for their support of the Group.
Thomas Lim Siok Kwee
Executive Chairman