Home / Shipping News / International Shipping News / SEACOR Marine Announces First Quarter 2020 Results

SEACOR Marine Announces First Quarter 2020 Results

SEACOR Marine Holdings Inc., a leading provider of marine and support transportation services to offshore oil and natural gas and wind farm facilities worldwide, yesterday announced results for its first quarter ended March 31, 2020.

Notable first quarter items include:

Average dayrates, excluding those for the crew transfer vessel fleet, increased to $11,157 in the first quarter of 2020 from $11,071 in the fourth quarter of 2019. The improved average dayrates reflect the change in the Company’s fleet mix over the period.

SEACOR Marine closed its acquisition of the remaining minority interests in Falcon Global Holdings LLC, increasing its ownership stake to 100%. Obtaining full ownership of the liftboat fleet will allow SEACOR Marine to manage the business with full flexibility going forward, which the Company believes will create value for its shareholders.

First quarter results include one-time restructuring charges of $0.5 million from the Company’s continuing cost reduction initiatives. The Company maintained its target of projected annual savings of at least $8.0 million, of which it has already achieved $7.7 million. The Company anticipates that the initiatives will impact all of its reportable segments and expects the bulk of the initiatives to be completed by the second quarter of 2020. The Company continues to evaluate additional opportunities for further cost reductions to adapt to the changing conditions.

First quarter revenues saw limited impact from COVID-19 and the drop in oil prices. The Company expects a deeper impact to revenues the rest of the year as a result of COVID-19 and reduced activity from its oil and gas customers due to lower commodity prices; however, the Company is unable to quantify such impact at this point but is closely monitoring and adjusting its operations accordingly.
Overall, total operating revenues for the first quarter were $41.7 million, operating loss was $24.6 million, and direct vessel profit (“DVP”)(1) was $17.1 million. This compares in the fourth quarter of 2019 to operating revenues of $49.1 million, operating loss of $10.5 million, and DVP of $23.1 million. The decrease in DVP in the first quarter was primarily driven by normal seasonally lower utilization, increased repairs and maintenance downtime and expense, and a reduction in available days due to vessel sales.

Chief Executive Officer John Gellert commented on SEACOR Marine’s first quarter results:

“I sincerely thank our employees at sea and ashore for their professionalism, dedication, and perseverance throughout the COVID-19 pandemic. Despite these difficult times, we have maintained safe, reliable operations for our customers worldwide.

“The business challenges from COVID-19 that began late in the first quarter and the unprecedented drop in oil prices continue to impact every aspect of the offshore oil and gas industry.

“We remain focused on having adequate financial liquidity to ride through this cycle. We continue to sell assets to optimize our fleet mix, while improving our margins and liquidity. Additionally, the passage of the CARES Act allows for the carryback of net operating tax losses to tax years prior to our spin-off from SEACOR Holdings Inc. (“SEACOR Holdings”) and corresponding tax refunds for those years. Subject to reaching an agreement with SEACOR Holdings, whose consent is required to make the necessary filings, we expect to receive a material amount of tax refunds over the next year, which will greatly assist to offset the potential effects to our business from COVID-19 and the recent drops in oil prices.

“We believe that, as we navigate these unprecedented times, the diversity of our assets, variety of missions supported by our equipment, and geographic spread of our operations will help mitigate the decline in business activity.”

For the first quarter of 2020, net loss attributable to SEACOR Marine was $15.9 million ($0.66 loss per basic and diluted share) and operating loss was $24.6 million. Net loss attributable to SEACOR Marine’s continuing operations for the first quarter of 2019 was $25.5 million ($1.11 loss per basic and diluted share) and operating loss was $21.0 million.

(1) Direct vessel profit (defined as operating revenues less operating costs and expenses, “DVP”) is the Company’s measure of segment profitability when applied to reportable segments and a non-GAAP measure when applied to individual vessels, fleet categories or the combined fleet. DVP is a critical financial measure used by the Company to analyze and compare the operating performance of its individual vessels, fleet categories, regions and combined fleet, without regard to financing decisions (depreciation and interest expense for owned vessels vs. leased-in expense for leased-in vessels). DVP is also useful when comparing the Company’s fleet performance against those of our competitors who may have differing fleet financing structures. DVP has material limitations as an analytical tool in that it does not reflect all of the costs associated with the ownership and operation of our fleet, and it should not be considered in isolation or used as a substitute for our results as reported under GAAP. See page 7 for reconciliation of DVP to GAAP Operating Income (Loss), its most comparable GAAP measure.

Full Report

Source: SEACOR Marine

 

Recent Videos

Hellenic Shipping News Worldwide Online Daily Newspaper on Hellenic and International Shipping