FPSO provider BW Offshore went from red to black ink during the second quarter of 2017 despite decrease in revenues.
According to its financial report on Tuesday, the vessel operator’s operating profit for the second quarter of this year amounted to $33.4 million, an increase of $28.7 million from the first quarter of 2017 and an increase of $8.5 million from $24.9 million in the 2Q 2016.
The second-quarter operating profit was affected by reversal of loss provisions, offset by an impairment charge on the FPSO Sendje Berge to reflect the termination of the contract by the client.
During the second quarter of the year period, BW Offshore recorded net profit of $5.2 million compared to a loss of $4.4 million in the prior-year period.
Further in the report, BW posted operating revenues for the quarter of $163.4 million, a decrease compared to $172.5 million in the prior-year quarter.
During the quarter, the company’s net debt increased to $1.41 billion from $1.38 billion debt at the end of the first quarter of the year.
BW Offshore currently operates 11 units. The owned fleet includes 15 FPSOs and one FSO. Average commercial uptime during the second quarter and the first half-year was 99.98%, compared to 99.97% in the first quarter of this year.
BW Offshore said the oil and gas markets remain challenging. While the company is experiencing increased market activity, it still expects a low number of awards in the medium-term. A more positive view on long-term activity levels is maintained as offshore developments will remain an important part of the oil and gas supply to meet future energy demand. In this market environment, the strength of the lease and operate business model enables a commercially disciplined approach for new investments, said the company.
The majority of BW Offshore’s fleet remains on long-term contracts with national and independent oil companies, and the fleet should continue to generate a significant cash flow in the time ahead. BW added that current oil price levels have reduced, but not eliminated, the risk of customers delaying or defaulting on their obligations.
Offshore Energy Today Staff