Deep Sea Supply planning to put more ships into layupCompany News // November 23, 2015
Deep Sea Supply says the state of the market is such that it will place more vessels in layup.
In the third quarter of 2015, Deep Sea Supply reported consolidated revenues of US$33.6 million and EBITDA of US$18.7 million (56 per cent). Following depreciation of US$11.8 million, financial expenses of US$5.2 million and negative currency items of US$0.9 millionb, pre-tax profit was US$0.9 million. For the nine months period ended 30 September 2015, the company reported consolidated revenues of US$109.5 million, EBITDA of US$58.4 million (53 per cent) and a pre-tax result of US$6.5 million.
Comparing the third quarter of 2015 with the second quarter of 2015, revenues fell by US$2.0 million as a rsult of lower utilization, due to vessels coming off long term charters and lower rates.
During the third quarter of 2015, the company said it has experienced a further weakening of global OSV markets. In Brazil, the situation remains difficult with reduced activity and foreign flagged vessels being blocked by vessels with local flag. However, for some vessel categories Petrobras has taken action to resolve this situation, and DESS expects blockings of four vessels to be lifted. The company said the North Sea spot market is challenging with unsustainable rate levels and low utilization, and many owners have chosen to lay up vessels instead of trading in
the spot market.
"No improvement in the market situation for OSVs is expected in the short to medium term," said the company.
Deep Sea Supply is pursuing some term opportunities, however it said competition is fierce and rates are low. As a consequence of the weak market, Deep Sea Supply will lay up vessels that do not have any fixed activity the next months, and the number of vessels laid up is expected to increase from the current 10 vessels.