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IHC, a new company in Burma



IHC 1st-Half Net Rises 54%; 1998 Profit Seen Up 24%

Schiedam, Netherlands, Aug. 24 (Bloomberg) -- IHC Caland NV, the largest Dutch
marine-construction company, said first- half net income rose 54 percent,
while a hefty order book allowed the company to raise its full-year profit
forecast even amid sluggish demand from Asia.   

Profit rose to 70.1 million guilders ($35 million), or 2.59 guilders a share,
in the six months ended June 30, from 45.4 million guilders, or 1.70 guilders
a share, a year earlier. The company's share price rose 0.8 guilder to 92.8.  

IHC Caland raised its full-year earnings forecast to 145 million guilders from
140 million guilders, compared with 117.5 million guilders last year. The
company said new orders in Myanmar, Brazil and West Africa will more than
offset slower demand in Asia, shielding the company from the financial turmoil
in Asia. IHC's win of an eight-year contract to Brazil's state-owned Petroleo
Brasileiro SA, worth $500 million, was a big coup, analysts said.   

``The most important factors are that the company increased its earnings
expectations, and announced the long- term eight-year charter to Petrobras,''
said Peter Los, an analyst at Rabo Securities, who expects further
announcements of new orders soon.   

IHC will supply a floating oil-production and storage system to Brazil's
Petrobras to exploit the Espadarte oil field. The company's lease activities
are increasingly important, adding to consistent demand for dredging, custom-
shipbuilding, and engineering services, analysts said.   

As of June 30, the company had 4.1 billion guilders worth of orders on the
books, compared with 3.8 billion guilders at the end of 1997. That doesn't yet
include business in Africa, where prospects are bright, the company said.   

``We expect demand to pick up off the coast of West Africa to make up for loss
of business in Asia,'' Chief Executive Jan Bax said at a press conference,
adding that prospects in Indonesia in particular had faded. ``The outlook for
the dredging-building sector is expected to remain promising, although not as
buoyant as last year.''      

The company is under fire for accepting a contract in Myanmar, formerly known
as Burma, which is often cited for human-rights abuses. IHC's SBM Production
Contractors Inc. won a 15-year contract last month worth ``hundreds of
millions'' of guilders to lease a floating oil-storage system to Premier
Petroleum Myanmar Ltd.   

Following questions in parliament about IHC's contract, the Dutch government
is consulting with the European Union about the possibility of economic
sanctions against Myanmar.   

Chief Executive Bax reiterated his refusal to cancel or alter the contract
because of Myanmar's human-rights record.