Emas reports rise in profit, drop in revenue

Singapore’s EMAS Offshore Limited reported net profit of $9.7 million in the second quarter of fiscal year 2015, an increase from the $4.0 million in the corresponding quarter of the previous fiscal year.

Revenue for the quarter was $60.9 million, compared to $67.6 million last year, a 10% decrease EMAS said that the decrease was mainly due to weakness in both the shallow water anchor handling, towing and supply vessels (“AHTS”) and shallow water platform support vessels (“PSV”) segment. This decrease is partially offset by contribution from the Production segment as a result of the reverse acquisition on 3 October 2014, EMAS added.

“The enlarged entity of EMAS Offshore has definitely positioned us to better ride out oil price volatility. While revenues and utilisation rates have declined due to market conditions, we have realised cost benefits and operational efficiencies from the business combination. We are also pleased that the FPSOs, which are largely insulated from the current depressed oil prices, continue to contribute positively,” said Jon Dunstan, EMAS Offshore’s Chief Executive Officer.

Profit Increase in 1H

For the first half of the fiscal year, reported net profit of $158.1 million was an increase from the $14.4 million in the corresponding period, boosted by one-off accounting effects of $137.5 million from the completion of the business combination of EOC Limited and EMAS Marine.

Net profit excluding the one-off accounting effects was also higher at $20.6 million, a 43 per cent increase.

The company posted lower revenue of $133.6 million for the first half, a 9 per cent decrease from $147.6 million, on the absence of contribution from a leased-in vessel returned in the second quarter of fiscal year 2014, as well as slower activity in the offshore support vessel sector.

In the Offshore Support and Accommodation Services division, offshore support vessel overall utilisation rate was 79% for the first half of the fiscal year, largely due to the weakness in the shallow water anchor handling, towing and supply vessels (AHTS) and shallow water platform support vessels (PSV) segments.

However, the company sees ongoing demand for deep water capable AHTS, where utilisation rate remains above 90%, EMAS said.

In the Offshore Production Services division, the two floating production, storage and offloading (FPSO) vessels, Perisai Kamelia and Lewek EMAS, continue to perform well, maintaining high operational uptime of almost 100%.

“Under the current circumstance we are taking a more cautious view for the ensuing quarters. However, we have taken steps to maintain our operational performance, which include exercising and implementing ongoing cost-optimisation initiatives, and focusing on operational excellence. These strategies will serve to protect our bottom line. Moving forward, we will ensure that we continue to improve operational efficiency with an added focus on sustaining vessel utilisation,” said Dunstan.