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Bibby Offshore Holdings Limited: Second Quarter 2017 Results

Bibby Offshore Holdings Limited: Second Quarter 2017 Results

Bibby Offshore Holdings Limited (“Bibby Offshore” or the “Group” or the “Company”), a leading provider of subsea installation, inspection, repair and maintenance (“IRM”) services to the offshore oil and gas industry, today announces unaudited results for the quarter ended 30 June 2017 

Key Highlights

 Q2 result table

Note: EBITDA is defined as net profit for the period plus finance costs, income taxes, depreciation and amortisation

Howard Woodcock, Chief Executive of Bibby Offshore, commented:

“As previously announced, we saw low levels of tendering in the early part of the year and this has been reflected in activity levels during Q2 resulting in the anticipated disappointing financial performance in the period.

“Post period end we have seen some improvement in contract awards and vessel utilisation is increasing into the summer period, albeit commencing later than expected. We therefore expect a significant improvement in activity in Q3, although with the current pressure on margin persisting. We remain focused on cash generation and maximising fleet utilisation.”

“In light of these ongoing challenging market conditions, as previously announced, the Company’s Board has been reviewing and developing a broad range of options aimed at addressing the Company’s capital structure and creating a platform from which to explore growth opportunities. As part of the ongoing evaluation of a range of options, the Board, alongside its adviser EY, now intends to actively explore a recapitalisation of the Company in conjunction with support from Bibby Line Group.”

Key Highlights       

  • Cash balance as of 30 June 2017 was £7.2m, with an additional £13.1m remaining available through the RCF facility
  • DSV fleet utilisation at 46%, up from 29% in Q1 2017 (Q2 2016: 48%)
  • New contract wins during the quarter with Enquest, Maersk, Apache, Aker BP and Perenco, and a late life production enhancement and decommissioning project with Maersk Oil UK
  • In the UK, the Group benefitted from the Framework Agreements previously announced with ConocoPhillips, Chevron, Dong and BP, all of which were utilised during the period, with BP continuing into Q3 on the Bibby Topaz with a significant diving scope of work
  • Framework Agreements with ConocoPhillips and Dong also provided significant air diving campaigns during the period in excess of 40 days each
  • Project engineering started for the previously announced TAQA construction works in the Eider field
  • Bibby Sapphire completed a project for Shell in the US in May
  • Since the start of the year, we have maintained injury free operations during our global offshore project delivery activity

Recent Developments

  • Following a slow start to the year, opportunities are now coming through at a steadier rate for Q3
  • Further contracts secured with Apache, Enquest, Engie and Total for Q3 2017 with the Bibby Polaris and Bibby Topaz
  • Recent contract awards with Perenco, Enquest and BP
  • Major ConocoPhillips diving project underway, with further decommissioning scopes in the Southern North Sea
  • Extensive IRM campaign completed for BP on Bibby Topaz using mixed gas and surface supply diving techniques
  • Final phase of CNR Murchison decommissioning completed in August utilising the Olympic Ares
  • Flexible pay as you go deal agreed on Olympic Ares at a reduced charter rate for the completion of booked work
  • Cost saving initiatives implemented in the USA resulting in a reduction in onshore personnel and the Bibby Sapphire put on a 2-3 week notice period
  • Limited visibility for Q4, with market conditions remaining challenging
  • As part of the ongoing evaluation of a range of options, the Board, alongside its adviser EY, now intends to actively explore a recapitalisation of the Company in conjunction with support from Bibby Line Group
  • Stuart Jackson will now be focused on the recapitalisation process and will then leave the business, and Neale Stewart will take over the finance responsibilities as Finance Director