Photo: Courtesy: Mermaid

Mermaid recognises three consecutive years of losses

Subsea services provider Mermaid has reported loss for the third consecutive year, this time of close to $110 million for the twelve months of 2020.

This result compares with loss of some $24 million in 2019.

The Singapore-listed company generated full-year 2020 revenue of $84 million, versus $108 million in 2019 – down some 22 per cent.

As of the end of December 2020, the order book stood at $190 million, generated mainly from long-term subsea business contracts and expected high potential awards in the Middle East.

Key material impact

In Q3 2020, Mermaid exercised option to sell all of its shares in Asia Offshore Drilling for $31 million.

By means of an accounting consequence, Mermaid needed to recognise a loss during this period for $61.8 million.

AOD was no longer an associated company of the Group as at 30 September 2020.

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Going forward

“The outlook for subsea service providers, though shaken by global pandemic in short term, continues to be positive on a longer term basis, as new projects will be sanctioned,” Mermaid said in its full-year 2020 earnings report.

The company is looking for options to initiate entry into the renewable energy business. It has re-structured the Group to explore significant opportunities in that space.

Mermaid also noted that it sees its Cable Division as the biggest short-term driver towards a business turnaround.

There are also a few nonperforming assets in the Group that have not yielded required returns for some years. As a result, Mermaid said it is working on their disposal, which includes vessels, some ROVs, Mobile SAT Spreads.

The company has recently sold its vessel Mermaid Siam and will recognise the gains of this disposal accordingly.