Chu Kong Petroleum and Natural Gas Steel Pipe Holdings Ltd. (PCK, 01938.HK) plans to acquire several overseas pipeline projects this year, including those located between China and Russia and between China and other Asian countries, the company’s top management said.
“We expect overseas projects to account for half of our total revenue” for 2014, PCK executive director Chen Zhaonian told a media briefing Monday. She said such projects have higher profit margins than domestic businesses.
Overseas sales accounted for 17.6 percent of overall revenue last year, down from 27 percent in 2012, according to a company statement. “Turnover days for capital are also faster in overseas projects,” Chen said.
The company seeks more orders involving deep sea projects, where profit margins are higher. “Not only do deep sea projects have higher margins, we are seeing more opportunities in that area as those on land are getting saturated,” she said.
The company is planning to participate in an auction for a project by Canada-listed Husky Energy Inc. in the second half. It has just completed several deep sea projects for CNOOC Ltd.’s (00883.HK) Liwan project in the South China Sea.
PCK plans to spend 500 million yuan (US$80.39 million) to 700 million yuan as capital expenditure this year.
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