Norwegian firm REM Offshore has posted second-quarter 2016 net loss of NOK 1.12 billion ($136.5 million), compared to profit of NOK 64.3 million or $7.8 million in a year-ago period.
The losses were recognised due to newbuild cancellation costs of NOK 191.7 million, and impairment losses of NOK 898.7 million ($109.5). Excluding these one-off effects, the Oslo-listed vessel owner had net loss of NOK 28.5 million.
In the second quarter, REM generated operating revenue of NOK 221.7 million compared to NOK 292 million in Q2 2015. Half-year 2016 operating revenue was NOK 457.4 million, down from NOK 607.8 million in the first six months of 2015.
Year-to-date loss came to NOK 1. 11 billion, against NOK 70.1 million profit. Total impairment losses of NOK 928.7 million have been recognised for the year to date.
Rem Offshore said it had 18 vessels in operation at the end of the period, namely 6 CSVs, 11 PSVs and one OCV. The fleet as a whole had a utilisation rate of 72% (95.0) in the second quarter including vessels laid up.
“In the short term, there are no signs of improvement in the market balance for offshore support vessels, but positive signals about higher scrapping activity among the largest players give grounds for cautious optimism in the longer term. Rem has laid up four vessels until market conditions improve, which is its contribution to a better balance between supply and demand.
The winter season will be challenging, with lower offshore activity in the North Sea, and it is possible that more vessels will need to be laid up,” the company said in Q2 2016 financial report.
In addition, as a result of earlier announced merger agreement , during the course of the year, REM Offshore will become a wholly-owned subsidiary of Solstad Offshore.
Subsea World News Staff