Offshore market remains tough says Rem OffshoreCompany News // May 20, 2016
Rem Offshore in Norway says the market for offshore support vessels is challenging "worldwide," with considerable excess capacity in all segments.
It says there are currently around 100 vessels laid up in Norway and there is fierce competition for contracts. Rem has laid up four vessels until market conditions improve.
The company said it has a satisfactory cash position, with liquid assets of NKr 695 million or around 15 per cent of interest bearing debt. The company said it will nevertheless continue to focus on safeguarding its cash position and reached agreement with its lenders on reduced loan payments in the first half of 2016.
Rem Offshore has no loans maturing in 2016. Post delivery financing has not been secured for the OCV ordered from Vard Group for delivery in 2018, and the board expects it to be difficult to finance the vessel with current market conditions. The company’s bond loans mature in 2018 and 2019.
Rem Offshore recorded operating revenue of NKr 235.7 million in the first quarter of 2016 (2015: 315.8). EBITDA came to NKr 109.3 million (160.8), and net profit for the period of was NKr 8.7 million (5.8).
As a result of the challenging market for the company’s vessels, ABG Sundal Collier was engaged as financial adviser to help ensure a long-term and sustainable capital structure. Wikborg, Rein & Co was engaged as legal adviser.