Repair business shines for Sembcorp Marine
Singaporean shipyard group Sembcorp Marine pointed to value growth in its ship repair business as slow rig and platform businesses contributed to a slum in turnover and net profit in 2017.
Group revenue declined by 33% to S$2.39 billion while net profit fell by 82% to S$14.1 million. The results were driven by a 42% turnover decline in Sembcorp Marine’s business building rigs and drillships, to S$1.1 billion, and a 34% decline in turnover from the offshore platform division, to S$732 million.
The smaller ship repair and upgrade unit recorded a 3% increase in sales to S$460 million. The company noted that while fewer ships were repaired, average revenue per vessel was higher due to an improved vessel mix with more higher-value works.
In the offshore market, the company noted the cancellation of an order for five jack-up rigs and fewer projects in hand for offshore platforms. “While the offshore oil and gas industry has begun to show signs of improvement, new orders flow remained weak, while competition within the sector intensified,” said Wong Weng Sun, president and CEO, Sembcorp Marine.
Examining the ship repair and upgrade business, Wong highlighted the repair of 16 cruiseships and 34 LNG carriers in 2017. The company also installed 11 ballast water treatment systems.
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