CSE Global looks beyond investing in UK

One of the very first stocks that i start with in 2003, CSE is indeed looking very attractive.

Great investment idea in my opinion.

 

Hee Teck

 

 

CSE Global looks beyond investing in UK

By NISHA RAMCHANDANI

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MAINBOARD-LISTED systems integrator CSE Global, which was awarded the 2008 UK Trade & Investment International Business Award yesterday, will continue to invest in Britain and plans to move in markets such as Canada, where it has yet to establish a presence.

'We will continue to look into acquisitions in the UK,' said group managing director Tan Mok Koon, adding that these will be funded by cash flow from the UK subsidiaries Servelec and Scomagg.

Beyond the UK, CSE Global would like to venture into Canada, Latin America, Central Asia and Eastern and Western Europe.

Currently, the oil and gas sector accounts for 75 per cent of the company's business. Power and water utilities, and transport and health care, account for 10 per cent each.

Mining and minerals constitutes 5 per cent, though Mr Tan reckons this sector could grow to 15-20 per cent in about three years.

CSE Global said it decided to invest in the UK because of the transparency of the system there. In 2000 it acquired Servelec, which now has annual turnover of more than £17 million (S$43.5 million). And in 2006 it acquired Scomagg. CSE Global has invested £25 million in the UK.

Its investments initially attracted scepticism, as Asian and Western companies have different styles of business. CSE Global also faced board pressure to send a Singaporean to the UK to keep an eye on operations.

But Mr Tan said 'mutual trust and respect are very important' in a business relationship. Instead, an incentive scheme was put in place 'to motivate management to work hard for us', he said. 'After all, we want to be a global company.'

The UK accounted for a revenue of £30 million last year, while profit (before tax) was £7 million. The group as a whole earned S$42 million in 2007, while revenue was S$405 million.

'This year we'll come in with good growth,' said Mr Tan. 'Analysts are expecting 30 per cent growth and I don't think we'll give any surprises,' he said. CSE Global is aiming for revenue of half a billion dollars.

Despite the credit crunch and slowdown in the economy, the company expects a steady stream of projects over the next few quarters. 'We will only be able to tell whether the credit crunch will affect us by 2010-2011,' Mr Tan said, pointing to the Middle East, Africa and the Gulf of Mexico as areas with strong demand.

The UK Trade & Investment International Business Award is conferred by the UK government on local companies with significant strategic and long-term investments in the UK.

 

 

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