OREANDA-NEWS. Sembcorp Marine today reported a 3% increase in net profit from USD 119 million in 1Q 2013 to USD 122 million in 1Q 2014, amid a challenging operating environment. Group turnover for the first quarter of 2014 registered a 27% year on year increase to USD 1.34 billion as compared with USD 1.05 billion for the corresponding period in 2013. The increase came mainly from higher revenue recognition from rig building activities and offshore platform projects.
Group EBITDA (earnings before interest, tax and depreciation) increased by 5% year-on-year to USD 176 million, while operating profit increased by 4% from USD 143 million in 1Q 2013 to USD 149 million in 1Q 2014. This was despite a 28% decline in other operating income to USD 12.4 million from USD 17.3 million. At pre-tax level, Group profit of USD 156 million was 5% higher than the USD 149 million achieved in the first quarter of last year. This was supported by higher income from associates and joint ventures which grew 15% to USD 7.1 million from USD 6.2 million previously.
OUTLOOK

The Group has a net order book of USD 12.9 billion with completion and deliveries stretching into 2019. This includes the USD 1.6 billion in new rig orders secured since the start of 2014, but excludes repair and upgrade contracts.

Long term fundamentals driving the offshore exploration and production (E&P) market remain stable, underpinned by firm oil prices. The Transocean contract to build two Jurong Espadon III, our proprietary design drillship, is a strong endorsement of the Group’s strategy to deepen, broaden and strengthen our product offering to capture this growing market segment. In a competitive industry landscape, the Group will focus on operational efficiency, productivity improvements, safety management and the timely delivery of orders to our customers.

Since Phase 1 of the Sembmarine Integrated Yard @ Tuas started operations on August 2013, demand for the four big VLCC docks continues to be strong. With its broad range of capabilities and leading edge technology, the new yard will position the Group for long term sustainable growth. The yard has attracted a good range of alliance and new customers as services continue to be ramped up. The Integrated Yard has dry docks totalling 1.55 million dwt and 3.9 kilometres of finger piers and basin quays, and is capable of servicing a wide range of vessels, including VLCCs, new generations of mega containerships, LNG carriers and passenger ships.

Construction on Estaleiro Jurong Aracruz, Sembcorp Marine’s wholly owned shipyard in Brazil, continues to progress well and remains on track to commence initial operations in 2H 2014, and is scheduled for completion in 2015.