Sembcorp Marine posts $192m net loss in H1

[The_King]

The group’s revenue declined 41.2% over the same period.

Sembcorp Marine (SembMarine) posted a net loss of $192m in H1, following the shutdown of production activities at all its Singapore yards since April, according to a filing. This was a severe deterioration compared with the net loss of $7m for H1 2019.

The group revenue for H1 totalled $906.2m, 41.2% lower than the $1.54b booked over the same period in 2019. This was largely due to lower revenue from rigs and floaters projects with only $459m, compared to $1.22b in H1 attributed to lower production activities due to the stand-down at the yards in Q2.

The group also posted negative earnings before interest, taxes, depreciation, and amortization (EBITDA) of $72m in H1 with the group operating loss at $173m.

SembMarine also incurred net finance costs of $49m due to higher interest cost and lower interest income, whilst net loss attributable to shareholders was at $192m.

On the other hand, revenue from repairs and upgrades increased 5% YoY to $258m over the same period from $245m in 2019. This was due to higher revenue per vessel at $3.49m on recognition of several upgrade projects for floating storage and regasification vessels (FSRU) and cruise ships.

Moreover, offshore platforms revenue soared 165% YoY to $130m, whilst specialised shipbuilding revenue increased to $35m in H1.

SembMarine notes that there were no significant new contracts secured in H1, stating that its net order book stood at $1.91b. In addition, the repairs and upgrades business has outstanding orders for execution totalling about $280m.

SembMarine’s capital expenditure (CAPEX) in H1 was around $58m, which was less than one third of the amount incurred in the previous year. This comprised mainly the completion of installation of certain new capabilities at the Tuas Boulevard Yard. The company expects its CAPEX to remain low, as only maintenance CAPEX will be incurred to ensure the safety and operability of yard facilities.

The group has also remained in a net current liabilities position of $259m, mainly due to term loans maturing in the next 12 months. SembMarine said it will look to refinance these loans with longer term maturities.

The rig builder noted that there was a substantial reduction in the group’s operating yard workforce, including sub-contractors, from about 20,000 to 850 persons since the circuit breaker measures were imposed. SembMarine’s Singapore yards had to stand down and discontinue production activities, resulting in significant delays to project executions.

As a consequence, all segments posted losses for the six-month period, with the exception of repairs and upgrades which reported higher profits on better product mix of higher margin upgrade projects which were executed in Q1.

Besides the production stand-down, other factors which contributed to the bigger losses were higher costs recognised for rigs and floaters, specialised shipbuilding projects, as well as lower margin recognition from offshore platforms projects.

SembMarine adds that the immediate priority of the company is to address urgent liquidity needs to fund its operations and ride out the severe industry downturn. The group has also deferred all non-essential CAPEX to preserve cash flow and manage overall liquidity prudently.

 

 

https://sbr.com.sg/shipping-marine/news/sembcorp-marine-posts-192m-net-loss-in-h1

[socrates469bc]

if sembcorp marine no loss, then i worry.

[The_King]

why all keep losing money

[socrates469bc]

4 minutes ago, The_King said:

why all keep losing money

 

work stoppage last half and next half will be order cancellations.

[The_King]

mean more ppl no job