Polarcus hit by delays but expects further awards, despite highly competitive marketCompany News // December 9, 2016
Polarcus Limited has updated its guidance on multi-client prefunding for the full year.
Based on preliminary numbers, the company expects to report a prefunding level of 120 per cent for the full year 2016, down from previously guided 150 per cent. The estimated multi-client investment of US$45 million for the full year 2016 remains unchanged.
Production on the company's current multi-client project in Brazil has been negatively impacted by what Polarcus described as "extraordinary operating conditions," including impacts from poor weather conditions and extreme barnacle growth, which will extend the duration of the project into February 2017. The slower production rate on the project will negatively affect the recognition of committed prefunding in the fourth quarter of 2016.
During the fourth quarter the company has experienced standby time on certain vessels due to unforeseen permit delays on client projects. This will have a negative impact on utilization and revenue generation in the quarter.
"High market competition is expected to continue in the near term resulting from the over-supply of vessel capacity relative to client tender volumes," said Rod Starr, CEO of Polarcus. "In spite of the highly competitive market, we expect to secure additional awards before year end as a result of our offering of industry leading assets and intelligent project designs."