File photo: SBM Offshore
Feb 8 (Reuters) – SBM Offshore expects 2017 revenue to fall 15 percent as the world’s top oil production ship leasing company said it sees early signs of stabilisation in the offshore industry, but warned that the recovery was slow.
“2017 is not going to be a good year in terms of order intake … we’re still in a phase of slow recovery in the industry,” Chief Executive Bruno Chabas said, while adding that he expected more orders in 2018.
SBM, which leases, operates and sells floating production, storage and offloading (FPSO) vessels, expects 2017 non-IFRS revenue of about $1.7 billion, a 15 percent decline compared to last year, and the third straight annual decline.
SBM’s 2016 full-year core profit (EBITDA) jumped 67 percent to $772 million, beating analysts’ estimates as strong growth in Lease & Operate offset weakness at its turnkey business.
The company said the overall decline in 2017 outlook was due to its transition from turnkey to lease and operate, with an improved outlook for the latter but a lower order backlog in turnkey due to market conditions.
“The Lease & Operate segment got boosted as three units that were under construction for two to three years have finally been delivered in 2016 and as such started their long lease contracts,” Kepler Cheuvreux analyst Andre Mulder said.
The Dutch-based company also proposed a cash dividend of $0.23 per share, an increase of 10 percent year-on-year, exceeding analysts’ expectations.
The company has also been struggling to put a Brazilian corruption scandal behind it. Brazilian prosecutors rejected a $328.2 million leniency deal that would have avoided prosecution for corruption related to contracts with state-led oil company Petrobras.
The company did not give an update on the settlement on Wednesday.
If the company manages to settle the case, as recent reports have indicated, SBM would be well placed to win a tender for the Libra oilfield offshore Brazil, KBC Securities analyst Tom Simonts said. (Reporting by Jochen Elegeert, editing by David Evans)
(c) Copyright Thomson Reuters 2017.
Join the gCaptain Club for curated content, insider opinions, and vibrant community discussions.
Join the 108,948 members that receive our newsletter.
Have a news tip? Let us know.
Panama's President Jose Raul Mulino responded "be serious, be serious" on Wednesday when asked in Davos whether he was concerned the U.S. would invade after President Donald Trump said he would take back the Panama Canal.
WASHINGTON, Jan 21 (Reuters) – The Trump administration has fired U.S. Coast Guard Commandant Admiral Linda Lee Fagan, the first female uniformed leader of an Armed Forces branch, for putting diversity issues over border security,...
HELSINKI, Jan 16 (Reuters) – The Eagle S tanker seized by Finnish authorities on suspicion of ripping up subsea cables will not face a separate criminal investigation into whether its fuel cargo violates sanctions...
Maritime and offshore news trusted by our 108,948 members delivered daily straight to your inbox.
Essential news coupled with the finest maritime content sourced from across the globe.
Sign Up
Join The Club
