Subsea engineering, construction, and services company Subsea 7 reported an increase in its quarterly net profit despite a 23 pct decrease in revenues.
The company on Thursday posted a net income of $149 million for this year’s third quarter versus the net income of $145 million in the prior-year third quarter.
The company’s revenues for the third quarter were 23% lower amounting to $928 million, compared to $1.2 billion in the corresponding quarter last year.
Active vessel utilization was 91% in the third quarter and total vessel utilization was 75%.
During September, two vessels left Subsea 7’s fleet with Seven Petrel sold outside the oil and gas sector and Normand Seven returned to its owner at the end of its charter contract. The new-build PLSV, Seven Sun, completed its final commissioning offshore Brazil and has started its five-year day-rate contract in November 2016.
At September 30 order backlog was $6.2 billion and order intake was $0.1 billion, with work awarded in the North Sea, the US Gulf of Mexico and Brazil.
Jean Cahuzac, Chief Executive Officer, said: “Industry conditions remained challenging in the third quarter and there were few awards made to the market. However, assuming the oil price increase over the last nine months is sustained and the cost reductions identified by the industry are consistently achieved, there is cause to believe that the number of SURF project awards to the market could increase within the next 18 months.”
Subsea 7 guidance for the full year 2016 has been updated with revenues still expected to be significantly lower in 2016 compared to 2015, but due to cost discipline, operational performance and project completions adjusted EBITDA percentage margin is now expected to be above 2015 levels, the company said.
Further, for 2017, Subsea 7 said its revenue is expected to be broadly in line with the group’s forecast for 2016 and adjusted EBITDA percentage margin is expected to be significantly lower.
Offshore Energy Today Staff