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Strategies
We intend to consolidate our current market position by capitalising on opportunities in the global marine
and offshore industry and to enhance our competitiveness. Key elements of our business strategy are as
follows:
Diversify sources of income by expanding ship chartering while maintaining focus on construction of
higher value vessels.
While shipbuilding remains our main focus, we intend to diversify our sources of income by expanding
our ship chartering business.
As at the Latest Practicable Date, our chartering fleet comprises five 3,600 bhp tugboats and five
10,000 dwt high deck loading barges. We are building nine vessels to be completed by 2009, which we
intend to add to our chartering fleet. We intend to retain ownership of these vessels and deploy them
on bareboat or time charters.
We currently have one work barge with accommodation for 300 people in operation with a strategic
partner. We are also building nine vessels that we have sold to our strategic partners to be completed
by 2010. In addition, we are building 10 vessels to be completed by 2010 that we intend to sell to our
strategic partners.
We expect that our ship chartering business will provide us with a source of income that is more stable
over the long term than shipbuilding alone. In addition, in the event of a slowdown in the shipbuilding
business, we intend to reallocate our resources and capacity to increase our ship repair and conversion
business.
With regard to our shipbuilding operations, we intend to continue expanding our operations with a
particular focus on complex, sophisticated and environment friendly offshore support vessels, which we
believe will continue to command higher prices within the industry.
Upgrading technology and processes to enhance our competitive position.
We plan to continuously upgrade our technical capabilities in order to strengthen our overall
competitiveness. We are also constantly seeking to shorten the vessel delivery period and minimise
project costs.
We also intend to invest further in advanced equipment and technology and to enhance our production
planning, sequencing, and inventory management processes. We have acquired a project management
software which enables us to track project management schedules and the progress in the construction
of vessels efficiently. This in turn will increase our efficiency and productivity in terms of project
management control.
Increasing capacity to construct more higher value vessels.
We intend to progressively increase our shipyard capacity in order to be able to take on more and
larger projects and to carry out the projects already recorded in our expanding order book. See “Our
Business — Significant Shipbuilding Projects — Order Book”.
We intend to expand the usable waterfront of our Batam shipyard from 450 metres to approximately
800 metres, extend our Syncrolift» berthside by 32 metres � 245 metres and purchase additional
gantry cranes, among other upgrades to our Batam shipyard facilities. We have also commenced
construction of one slipway. All of these will enable us to increase our shipbuilding capacity in Batam.
We intend to complete the expansion and installation of these facilities by the end of FY2009.
We are currently evaluating the commercial viability of building a shipyard in China. Subject to our
evaluation of the commercial viability of the project and us obtaining all relevant approvals, licenses
and permits, we may build a shipyard in China (see “Our Business — Expansion and Upgrading
Plans”).
Strengthening our engineering and middle-level management teams to support our expanding
operations.
We believe that our strong engineering and management teams have been critical factors in building
the reputation we have in the market. As our operations expand, we will need to strengthen our
engineering and middle-level management team by recruiting, developing and retaining talent.
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