France-based Bourbon Offshore is hoping that the market for offshore oil and gas marine services has bottomed out as its fleet utilization rates continued to decline in the third quarter of 2016 as expected.
The company on Thursday reported financial information for Q3 and the first 9 months of 2016, revealing adjusted revenues fell 9% in Q3 compared with the previous quarter. For the first 9 months of 2016, adjusted revenues were down 22.2% to 858.2 million euro.
The company reported a 4.5% decrease in fleet utilization rates compared with Q2 to 59.7%, primarily due to the slowdown in activity in the shallow and deepwater offshore segments. By the end of September the company’s stacked fleet, excluding crew boats, grew to 85 vessels. In Q4 it expects to see comparable performances, with only a slight improvement in the subsea and crew boat segments.
Looking towards next year however, the company is hoping that market has finally bottomed out.
“The expectations of a potential rebalancing of oil supply and demand in 2017 on account of the sharp drop in investment by oil companies, as well as the search for agreements between producer countries, may mark the start of a recovery in activity”, declared Jacques de Chateauvieux, Chairman and Chief Executive Officer of BOURBON Corporation.
“In this perspective, BOURBON is focusing on operational excellence and cost control, with a long-term vision where the benefits of the digital revolution could prove decisive,” Chateauvieux added.
Bourbon Offshore has a modern and standardized fleet of more than 510 vessels and 34 operating affiliates. The company offered the following outlook in its report:
In a context marked by the upward revision of the demand for oil in 2017, inventory stagnation and an offering that is expected to contract, given the reduction in investment over the past two years, we are seeing signs of a return to growth, albeit with a time lag.
Clients are going to increase maintenance operations on installations and embark on projects to extend existing facilities.
In the first half of 2017, the impact on our Deepwater and Shallow water offshore supply vessel segments will be very limited, with drilling activity remaining at very low levels; however, this impact will in all likelihood be more visible in our Crew boat and Subsea/ maintenance support activities from early 2017.
BOURBON is therefore continuing its efforts to streamline operations reduce costs and preserve cash, with the same objective of “operational excellence”.