SINGAPORE (July 30): Sembcorp Marine (SembMarine) reported an 85% smaller net loss of $9 million, or 0.41 cent per share, in 2Q19 compared to a net loss of $56 million in 2Q18.
Group revenue for 2Q19 was 55% lower at $731 million compared with $1.63 billion in 2Q18 which saw revenue recognition from the delivery of two jack-up rigs to Borr Drilling and the sale of a semi-submersible rig, mitigated by higher repair and upgrade revenue. Excluding the effects of the rigs in 2Q18, 2Q19 revenue would have been $722 million, an increase of 26% compared with $572 million in 2Q18.
Revenue from rigs and floaters fell 61% to $542 million, revenue from repairs and upgrades was up 13% to $142 million, revenue from offshore platforms fell 60% to $34 million, revenue from specialised shipbuilding was flat at $2.8 million while sales from other activities came in 67% lower at $9.7 million.
Gross profit for 2Q19 was $4.6 million compared to a gross loss of $47.1 million as cost of sales shrank 56.6% to $727 million from $1.7 billion a year ago due to low overall business volume, offset by margin recognition from newly secured production floater projects and delivery of a rig.
After deducting for expenses, operating loss came in at $4.4 million, 91.6% lower than the $52.6 million loss a year ago.
As at end June, cash and cash equivalents stood at $782 million.
In its outlook statement, SembMarine says challenges in the offshore and marine sector persist, and it will take some time before a sustained recovery in new orders in seen, Meanwhile, competition is expected to remain intense and margins compressed.
Shares in SembMarine closed at $1.43 on Monday.
