CGS International
Date of Report: August 20, 2025
Marco Polo Marine: Fleet Expansion, ESG Progress, and Sector Outlook – An In-Depth Financial Analysis
Introduction: Marco Polo Marine Navigates Growth in Offshore & Marine Sector
Marco Polo Marine (MPM), a Singapore-based offshore and marine player, stands at a pivotal moment as it leverages strong demand in the offshore wind sector, embarks on fleet expansion, and enhances its ESG credentials. With its recent successful CSOV launch, anticipated new vessel contracts, and improving market conditions, MPM is attracting fresh investor interest. This comprehensive analysis, based on the latest broker research, dives into the company’s financials, market performance, peer comparison, and ESG trajectory.
Upbeat on Fleet Expansion: CSOV Success and More Vessels on the Horizon
MPM’s analyst briefing highlighted the robust performance of its new Commissioning Service Operation Vessel (CSOV), which has been contributing well with minimal setup issues. The company is actively discussing a second CSOV contract, expected to be announced in the second half of calendar year 2025, with delivery and revenue contribution likely from end-2027.
Key fleet expansion themes include:
- Strong CSOV Revenue: MPM earned S\$11 million from new offshore wind vessels in the first nine months of FY25, with S\$6–7 million attributed to the new CSOV launched in April 2025.
- Bank Financing Eases: Improved financing conditions for Offshore Support Vessel (OSV) players could accelerate new vessel additions, especially given MPM’s solid net cash position.
- Fleet Realignment: The company has been divesting older tugs to redeploy capital into the higher-growth offshore wind segment.
Financial Performance: Revenue, Margins, and Utilization Trends
MPM reported that group revenue for the first 9 months of FY25 accounted for 66% of both its own and consensus full-year forecasts, slightly below the anticipated 70% due to lower oil & gas sector charter rates, vessel downtime for drydocking, and the sale of two tugs. Gross margin improved by 2 percentage points year-on-year to 44%, driven by a favorable shift towards high-margin ship repair work.
| Metric |
3QFY25 |
3QFY24 |
% YoY Change |
2QFY25 |
% QoQ Change |
9MFY25 |
9MFY24 |
% YoY Change |
| Ship Chartering Revenue (S\$m) |
22.2 |
23.1 |
-3.9% |
N/A |
N/A |
54.2 |
56.0 |
-3.2% |
| Shipyard Revenue (S\$m) |
9.5 |
11.8 |
-19.5% |
N/A |
N/A |
30.2 |
40.5 |
-25.4% |
| Total Revenues (S\$m) |
31.7 |
34.9 |
-9.2% |
26.9 |
+17.9% |
84.4 |
96.5 |
-12.5% |
| Gross Profit (S\$m) |
14.0 |
14.6 |
-4.1% |
11.0 |
+27.0% |
35.6 |
36.8 |
-3.2% |
| Gross Margin (%) |
44.2% |
41.8% |
+2.4pts |
41.0% |
+3.2pts |
42.2% |
38.2% |
+4.0pts |
- Utilization Rates: Yard utilization reached 88% in 3QFY25 (vs. 73% in 2QFY25), but yard revenue dropped 19% year-on-year due to lack of newbuild activity.
- Fleet Utilization: Certain vessels underwent drydocking because of project delays, with utilization expected to recover from 1QFY26 onward.
- Margin Expansion: Shift toward ship repairs and CSOV charters supported higher margins, offsetting some revenue softness.
Upward Re-Rating and Valuation: Target Price Raised
CGS International reiterated its “Add” rating, raising the target price (TP) for MPM to S\$0.08 (from S\$0.06), reflecting a shift to 10x FY26F P/E, aligning with sector peers. The report sees several catalysts for further upside:
- Contract wins for a second CSOV
- Announcements of further vessel additions
- Higher-than-expected fleet utilization
Key downside risks include lower yard utilization and project delays in the offshore wind sector.
| Metric |
Sep-23A |
Sep-24A |
Sep-25F |
Sep-26F |
Sep-27F |
| Revenue (S\$m) |
127.1 |
123.5 |
118.3 |
142.4 |
152.7 |
| Operating EBITDA (S\$m) |
43.30 |
42.70 |
40.68 |
53.31 |
59.27 |
| Net Profit (S\$m) |
22.58 |
21.70 |
22.15 |
32.01 |
35.77 |
| Core EPS (S\$) |
0.006 |
0.007 |
0.006 |
0.009 |
0.010 |
| Core EPS Growth (%) |
60.9% |
4.5% |
(10.0%) |
44.5% |
11.8% |
| ROE (%) |
15.1% |
14.0% |
11.3% |
14.5% |
14.2% |
Other notable financial statistics:
- Dividend Yield: Projected to rise slightly from 1.52% to 1.82% by FY27.
- Net Gearing: Remains low, with net cash position throughout the forecast period.
- P/BV: Decreases from 1.45x (Sep-23A) to 0.92x (Sep-27F), indicating improving balance sheet strength.
Peer Comparison: How MPM Stacks Up
The report provides a detailed comparison of MPM with regional and global peers, focusing on metrics such as price-to-earnings, price-to-book, earnings growth, and dividend yields.
| Company |
Ticker |
Rec. |
Price (lcl curr) |
Target Price |
Market Cap (US\$m) |
P/E CY25F |
P/E CY26F |
2-Year EPS CAGR (%) |
P/B CY25F |
P/B CY26F |
ROE CY25F (%) |
Dividend Yield CY25F (%) |
| Marco Polo Marine |
MPM SP |
Add |
0.07 |
0.08 |
193 |
10.1 |
7.5 |
19.1 |
1.2 |
1.0 |
12.2 |
1.7 |
| Pacific Radiance |
PACRA SP |
Add |
0.06 |
0.09 |
70 |
5.5 |
4.9 |
94.9 |
0.7 |
0.6 |
13.8 |
0.7 |
| Mermaid Maritime |
MMT SP |
Add |
0.11 |
0.16 |
168 |
8.2 |
5.9 |
59.3 |
0.6 |
0.6 |
8.2 |
0.0 |
Other listed companies in the peer table include Vallianz Holdings, ASL Marine, Kim Heng Ltd, Nam Cheong, Wintermar Offshore, Logindo Samudramakmur, Sillo Maritime Perdana, Sealink International, Marine & General, Lianson Fleet Group, Perdana Petroleum, Sea1 Offshore Inc, Tidewater Inc, Helix Energy Solutions, Subsea 7, and SEACOR Marine, among others. For many, only price and market cap are available, with earnings forecasts not provided for all.
ESG Focus: Sustainability, Safety, and Innovation
MPM has made notable progress in aligning operations with environmental and social responsibility goals:
- Hybrid Energy Systems: Implementation on CSOVs could cut fuel consumption and emissions by 15–20% compared to traditional vessels.
- Ammonia-to-Power Collaboration: MoU signed with Amogy for integration of ammonia-to-power systems on wind vessels.
- Green Ship Recycling: MPM is venturing into end-of-life ship recycling. Its Indonesian yard is the country’s first to be ISO 30000:2009 certified.
- Emissions & Energy Intensity: Scope 1 and 2 emissions reduced by 12% year-on-year, energy intensity cut by over 50% in FY23, though total electricity consumption rose 15% due to operational scaling.
- Workplace Safety: Rising incidents, from 8 in FY21 to 32 in FY23, highlight the need for stronger safety protocols and training as business activity grows.
Balance Sheet Strength and Cash Flow Overview
MPM continues to maintain a robust financial position, with a strong cash balance, low gearing, and prudent capital management.
| Metric |
Sep-23A |
Sep-24A |
Sep-25F |
Sep-26F |
Sep-27F |
| Total Cash & Equivalents (S\$m) |
63.1 |
68.8 |
55.5 |
71.2 |
78.4 |
| Total Debt (S\$m) |
2.3 |
33.0 |
24.2 |
25.2 |
31.3 |
| Shareholders’ Equity (S\$m) |
167.8 |
185.0 |
206.2 |
235.9 |
268.9 |
| Operating EBITDA Margin (%) |
34.1% |
34.6% |
34.4% |
37.4% |
38.8% |
| Net Cash Per Share (S\$) |
0.017 |
0.010 |
0.008 |
0.012 |
0.013 |
Conclusion: Investment Perspective and Outlook
Marco Polo Marine’s strategic expansion into offshore wind, its proactive approach to ESG, and robust financial health position it as a leading contender in the regional offshore and marine sector. Continued progress on fleet modernization, further CSOV deployment, and consistent margin expansion are set to drive long-term shareholder value. However, investors should be mindful of operational risks, especially around shipyard utilization and project timelines in the renewable energy sector.
For those seeking exposure to Asia’s offshore and marine growth story, MPM offers a compelling combination of value, growth, and sustainability focus.
