Robust business model aids Topaz Energy and MarineCompany News // August 18, 2017
Topaz Energy and Marine has unveiled results for the six months ended 30 June 2017. The company says overall fleet utilization was 62 per cent, and 96 per cent in Azerbaijan. The company had a robust EBITDA margin of 50 per cent, despite utilization and rate pressure in Africa and the MENA region. The company's focus on cost control has resulted in savings of US$14 million in the first half of 2017 compared to the same period last year. Topaz Marine and Energy is fully compliant with financial covenants and credit ratings by S&P and Moody’s remain stable.
René Kofod-Olsen, Chief Executive Officer at the company, said "Topaz continues to deliver value for its investors and shareholders despite the ongoing challenges of the sector. Our focus remains on driving cost efficiencies across the business whilst continuing to make the investments that mean Topaz is able to offer a differentiated proposition to its customers. We are beginning to see some signs of recovery in the market and we expect 2018 to offer better opportunities for growth.
“We successfully completed the issuance of US$375 million 9.125% Senior Notes during the first half, which was achieved against the backdrop of both a volatile economic environment and what remains a challenging market for the offshore services sector. The positive reception from investors was testament to the robustness of our business model and long-term growth strategy. The refinancing further strengthens our long-term, sustainable capital structure, equipping Topaz for its next phase of growth.
“We also won a new US$100 million contract with Dragon Oil, the upstream oil and gas subsidiary of Emirates National Oil Company (ENOC) whose principal asset is the Cheleken Contract Area, in the eastern section of the Caspian Sea, offshore Turkmenistan.
"Under the terms of the contract, Topaz will supply Dragon Oil Turkmenistan with six vessels, comprising five anchor-handlers and one emergency recovery and response vessel. The contract has already commenced with vessel mobilization and operation ramp-up under way. The contract is scheduled for a five-year term with a two-year option and brings Topaz’s market leading revenue backlog above US$1.5 billion.
“Revenue for the six months ended 30 June 2017 is US$115.6 million, which is down 23 per cent compared with the same period last year. EBITDA is at US$57.6 million, down 25 per cent compared with the same period last year. Our EBITDA margin remains stable at 50 per cent on the back of our effort to optimize our cost base and reshape the organization to better perform in a volatile and unpredictable market. Our operating costs reduced by US$14 million and stand at US$77.9 million for the quarter."