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STX OSV Achieves Highest Revenue And Margins In Operating History

Thursday, 16 February 2012 | 00:00
STX OSV generated operating revenue of NOK 3.11 billion in 4Q 2011 and NOK 12.40 billion for FY 2011 with the successful delivery of 23 vessels during the year. The Group’s 4Q 2011 operating profit more than doubled from a year ago to NOK 820 million and grew by 83% to NOK 2.21 billion for the full year.
EBITDA increased to NOK 876 million for 4Q 2011 and NOK 2.36 billion for FY 2011, yielding an EBITDA margin (EBITDA to total operating revenues) of 19.0% for the full year. Earnings per share came in at NOK 1.35 (SGD 29.3 cents). The increase from FY 2010 was largely due to the Group’s stable operating performance, improved productivity levels and well-utilized yards. Successful project deliveries and the release of risk contingencies to profit at the end of complex projects contributed to the exceptional financial results.
Cash and cash equivalents increased to NOK 3.06 billion as of 31 December 2011 as the Group continued generating positive operating cash flow, while the draw-down on construction loans was reduced at the same time. Net asset value as at 31 December 2011 was up 48% to NOK 3.51 billion (SGD 761 million).
Based on the Group’s exceptional financial performance in 2011, the Board of Directors expects to recommend STX OSV to pay a final dividend of SGD 10 cents per share for FY 2011. The recommended dividend for FY 2011 will be announced in early April for approval at the Annual General Meeting in late April 2012.
Over the year, the Group has demonstrated sustained strong operational performance due to
improvements in productivity as well as key health, safety and environment (“HSE”) indicators. Norway and Romania are registering excellent performance, good yard utilization and high rate of ontime deliveries. The existing Brazil yard is operating at maximum capacity, and is facing some constraints in the subcontractor market. Developments at the Group’s newest yard in Vietnam continue on a positive path, with two out of three vessels in 2011 being delivered ahead of time.
Orders, Deliveries and New Contracts
New order intake for FY 2011 came in at NOK 11.12 billion across 28 vessels. In 4Q 2011 alone, new order intake accounted for approximately NOK 6.03 billion, which includes the NOK 3.29 billion contract for eight LPG carriers for Transpetro made effective on 18 November 2011, and another six new vessel contracts. Ten vessels were delivered out of various locations in 4Q 2011, with a total of 23 delivered throughout the year. 4Q 2011 represented a marked improvement over 3Q 2011 as orders for existing yards returned to levels sufficient to stabilize order book length, in addition to the extraordinary order intake book for vessels to be built at the new Brazil yard.
As of 31 December 2011, the Group had a total of 54 vessels in its order book, 32 of which will be of STX OSV’s own design. Total order book for FY 2011 is worth around NOK 16.68 billion, compared to NOK 17.03 billion a year ago.
Brazil new yard project gaining momentum
Financing for STX OSV’s development of a new shipyard at Suape in the state of Pernambuco, Brazil, has been finalized. Construction of the yard commenced in 4Q 2011, with the detail design process, land leveling and dredging of the new harbor basin still ongoing. A new yard manager has been appointed, and a project organization has been put in place to drive the development of the new yard, which is expected to further strengthen STX OSV’s position in the key growth market Brazil.
Outlook
Against the backdrop of strong market fundamentals, with oil majors continuing to increase their E&P spending budgets, STX OSV sees signs of increasing demand in particular for AHTS and offshore construction vessels. However, uncertainty remains as to when this will translate into a sustained upturn in new order activity in the OSV market. The rate of order conversions is still hampered by constraints in shipowners’ ability to finance new vessel projects.
Mr Roy Reite, Chief Executive Officer and Executive Director of STX OSV, commented, “Despite ongoing economic headwinds, we have observed robust activity in the deepwater offshore oil and gas exploration and production sector, which we believe will continue to underpin healthy demand for our proprietary designs and vessels.”
Source: STX OSV
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