Deep Sea Supply Cautiously Optimistic. Sees Opportunities in W. Africa and Asia
Deep Sea Supply reports consolidated revenues of MUSD 38.7 in 1Q 2013 compared to MUSD 21.4 in 1Q 2012.
Total operating expenses in 1Q 2013 were MUSD 23.3 compared to MUSD 17.7 in 1Q 2012. This resulted in EBITDA of MUSD 16.7 in 1Q 2013, compared to MUSD 4.9 in 1Q 2012. Following financial expenses of MUSD 7.0, the pre-tax result was a profit of MUSD 7.0 in 1Q 2013, compared to a negative MUSD 6.9 in 1Q 2012.
In relation to the upcoming sale of 50% of DESS’ Brazilian business to BTG Pactual in Brazil, the assets held for sale are not depreciated in 1Q 2013.
The high contract coverage and firm contract backlog of MUSD 297 as of 1 May 2013 provides good earnings visibility during 2013 and 2014. The Company has removed 2 vessels from the North Sea spot market to commence term charter contracts in Brazil, and therefore currently has 1 vessel operating in the North Sea spot market.
The progress of the sale of 50% of DESS’ Brazilian business to BTG Pactual in Brazil is good, all necessary third party approvals have been obtained and the Company expects to close the transaction end of May. By establishing this joint venture and buying six newbuilding PSVs together with BTG, the Joint Venture will own a fleet of 21 vessels and be the third largest OSV owner in Brazil, one of the world’s largest markets for OSVs.
The Company has said it sees attractive opportunities in areas like West Africa and Asia, and will actively seek to increase its fleet and further strengthen its position by focusing more on such areas.
DESS remains cautiously optimistic for the OSV market in 2013. Many new rigs will be delivered this year, which is positive and moving the supply/demand balance in favor of OSV owners. A number of OSVs (especially PSVs) have been ordered in 2012, but the Company also experiences a continued increased demand for large and modern PSVs. Tendering activity is high internationally. Increased activity, both in established and new markets, continue to drive demand for large and modern OSVs, and Deep Sea Supply’s fleet of cost efficient vessels is well positioned to take part of this development.
Press Release, May 15, 2013