Seatrium Ltd has won a jack-up rig contract from Saudi Arabia-based International Maritime Industries.

The contract value was not disclosed. It was won via Seatrium Offshore Technology, the offshore jack-up designer unit under Seatrium. 

"This milestone marks the historic beginning of new-build construction in IMI since the yard’s opening and underscores the start of an ambitious long-term partnership with IMI to construct offshore jack-ups in the Kingdom," says Seatrium on Feb 20.

The company says it has designed and been involved in the construction of more than half of all jack-up rigs in service and 65% of the jack-ups operating in the Middle East.

Seatrium is set to report its FY2024 earnings tomorrow, Feb 21.

In its Feb 20 note, DBS Group Research estimates the contract to be worth between $50 and $100 million and believes that Seatrium is aiming for more such deals.

"The group has seen positive newsflow on order wins since end of 2024, boosting confidence on their revenue growth prospects," says DBS.

For Seatrium's FY2024 earnings announcement tomorrow DBS will be watching out for key data points such as the company's margin recovery and guidance forward.  

DBS is expecting high single-digit gross margin for FY2024 which is then seen to improve to 10% this current FY2025 and 12% next year. 

This shall lift core earnings from around $240 million in FY2024 to $430 million in FY2025 and $650 million the following year. 

"We expect robust order wins and earnings recovery to catalyse share price further," says DBS, which has a "buy" call and $3 target price.