TSC Offshore Group Limited (“TSC Offshore” or the “Company”, together with its subsidiaries as the “Group”, stock code: 8149), a product and service provider dedicated to the world oil and gas drilling industry, saw a 37 per cent increase in its unaudited consolidated turnover for the first quarter ended 31 March 2009 (the “Period”) to approximately US$26.5 million, as compared with that of the same period last year. Gross profit rose by approximately 6.9 per cent to approximately US$4.7 million in the Period as compared with that of the same period last year.

Increase in the Group’s turnover was mainly attributable to the sales generated by the recently acquired cranes and other handling equipment business, in addition to the sales increase from the other rig products and technology segment which in total reached approximately US$19.5 million. However, as the cranes and other handling equipment business had relatively lower margins, the Group’s gross margin dropped to 17.6 per cent for the Period from 22.5 per cent of the corresponding period in 2008. Compared with that of the same period last year, the Group’s selling and distribution expenses and general and administrative expenses also increased to US$2.8 million and US$4.2 million respectively, as a result of the full recognition of such expenses from the acquired companies.. The Group reported a loss attributable to equity shareholders of US$2.8 million for the Period.

“Although the newly acquired companies had incurred greater expenses for the Group, we believe they will remain a revenue engine for the Group in the long run, as reflected in our first quarter results. We will continue to improve the operation efficiency of these acquired companies, in order to gain not merely on revenue growth, but profit growth from these companies,” said Mr Jiang Binghua, the Executive Chairman of TSC Offshore.

The Board of Directors does not recommend the payment of an interim dividend for the three months ended 31 March 2009. (Corresponding period of 2008: Nil).

During the Period, turnover from rig turnkey solutions amounted to approximately US$2.5 million, based on the percentage of completion of the construction contracts. With respect to oilfield expendables and supplies business, the Group achieved a satisfactory growth of 32.7 per cent in turnover to approximately US$4.6 million when compared with that of the same period last year.

“Although the recent economic slowdown shows no material sign of recovery and may affect the demand for drilling equipment and related services, we believe the demand for energy in the long run shall continue to be strong as global oil and natural gas reserves are limited by nature. We are cautiously optimistic about the future of our business in the long run,” Mr Jiang remarked.

Mr Jiang added: “In the short run, we will continue to implement the strategy of ‘building solid foundation for further growth in future’. We will keep controlling our costs to enhance our cost effectiveness and to further strengthen our competitive position in the industry.”

TSC Offshore submitted an application for a proposed transfer of listing from the Growth Enterprise Market to the Main Board of the Stock Exchange of Hong Kong Limited on 7 May 2009.

About TSC Offshore

TSC Offshore is a product and service provider in the world onshore and offshore oil and gas drilling industry. The Group is principally engaged in the provision of rig products and technology (drilling equipment, mechanical handling equipment, solid control systems, jacking systems, tensioning systems, conduct tensioning unit (“CTU”)), oilfield supply chain solution (such as rig expendables and accessories for both onshore and offshore rig operations) and turnkey solutions for both new build and upgrade rigs.

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Issued by: TSC Offshore Group Limited
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