DOF Subsea cuts third quarter loss

DOF Subsea has reported NOK 133 million loss in the third quarter of 2020, against NOK 1.1 billion in Q3 2019.

The company generated operating revenue of NOK 1.2 billion, against NOK 1.15 billion same time last year.

Revenue also includes cancellation fee of NOK 110 million for two long-term contracts that have been cancelled.

Operating profit before depreciation and impairment (EBITDA) was NOK 594 million, versus NOK 338 million in 2019.

The operating profit after depreciation and impairment (EBIT) was negative NOK 99 million.

During Q3 2020, the Group recognized impairment and depreciation of tangible assets of NOK 648 million.

According to DOF Subsea, this was due to the continued weak market for vessel services and the low demand visibility for its services going forward.

The average vessel utilisation in the Subsea/IMR projects segment was 75 per cent for the quarter.

The utilisation of the vessels within long-term charter segment was 95 per cent. For the fleet in total, the utilisation was 82 per cent.

For the first nine months of 2020 the Group generated revenue of NOK 3.1 billion and loss NOK 2.1 billion

This compares to NOK 2.96 billion in revenue and loss of NOK 1.1 billion in 2019.

The impact of the covid-19 virus and the weak oil price have led to postponement and cancellation of offshore projects and tenders.

The market conditions have become more challenging, with continued oversupply of services and subsea vessels, however with regional variances.

The visibility of the demand for the Groups services is low and the medium-to-long-term impact on the liquidity and solidity is difficult to address.

The number of subsea employees at the end of Q3 2020 was 1,159.

The Group’s fleet comprised of 24 owned vessels, 3 chartered-in vessels and 70 ROVs.

At the end of third quarter, the firm contract backlog amounted to NOK 13.1 billion. NOK 6.3 billion is DOF Subsea Group and NOK 6.82 million is share of joint venture vessels.