April 27, 2010 / 4:59 PM / 8 years ago

Horizon North shares soar to 18-month high on contract win

* Says to install an 830-unit construction camp

* Shares rise 22 pct

April 27 (Reuters) - Shares of Horizon North Logistics Inc (HNL.TO), which provides camp-related services to the oil and gas and mining sectors, rose to an 18-month high Tuesday, a day after it got a two-year contract valued at 70 percent of its revenue last year.

The C$104 million ($104 million) contract with an undisclosed Canadian resource project is for a 2,700-person, 830-unit construction camp, said Horizon.

The company, which posted fiscal 2009 revenue of C$143.9 million, said 45 percent of the contract was scheduled for this year, 50 percent for 2011 and the rest for 2012.

“With most of the work over two years, 2010 and 2011 will show significant increases in camp sales revenue,” analyst Brian Purdy of National Bank Financial said in a note to clients.

Given that Horizon can currently make 1,100 units per year, this deal will occupy about 35 percent of its capacity through 2011, Purdy added.

Shares of the company were trading up 15 percent at C$2 Tuesday afternoon on the Toronto Stock Exchange. They touched a high of C$2.12 earlier in the session. ($1=1.000 Canadian Dollar) (Reporting by Arnika Thakur in Bangalore; Editing by Don Sebastian)

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