McDermott Shrinks Loss as Revenue Grows

McDermott reported that its first-quarter 2016 loss narrowed some 85 per cent on better-than-expected revenue boost.

The Houston-based company recognized quarterly loss of $2.2 million, or $0.01 per fully diluted share, compared to net loss of $14.5 million, or $0.06 per fully diluted share same time last year.

The Offshore EPCI player has generated first-quarter 2016 revenues of $729 million, up from $550.5 million from the prior-year quarter. According to the company, increase in revenues was mainly associated with the INPEX Ichthys and Saudi Aramco 12 jackets projects.

Order intake in the first quarter of 2016 totaled $339 million, including the contract with Woodside and an EPCI project in the Middle East.

Petrobras termination

Petrobras, decided to cancel the charter for Mcdermott’s Agile vessel in May 2016, reportedly, due to non-renewal of the charter authorization certificate. As a result the contract termination, Mcdermott recorded a non-cash impairment charge of $32 million during the first quarter. In addition, Mcdermott has taken a reduction of $38 million in its backlog.

As of March 31, 2016, McDermott’s backlog was $3.8 billion, of which approximately 71 per cent is related to offshore operations and approximately 29 per cent is related to subsea operations.

The company said it had bids outstanding and target projects of approximately $18.4 billion that it expects to be awarded in the market through June 30, 2017.

In addition, the company raised its 2016 adjusted EPS estimate to $0.06 a share on revenue of $2.7 billion.

Subsea World News Staff