Topaz Energy nine-month revenue drops 21%

dubai — Topaz Energy and Marine, a leading offshore support vessel company, said on Thursday its nine-month revenue dropped 21 per cent to $ 216.1 million on account of increasing market pressure on rates and utilisation in Africa and Middle East and North Africa.

René Kofod-Olsen, Chief Executive Officer, the Dubai headquartered company, said, the decrease in revenues could be attributed to the offshore support vessel (OSV) sector challenges, primarily driven by day rate reductions on long term contracts and direct loss of revenue due to increasing market pressures on utilisation and rates.

“Our total utilisation is however above regional benchmarks, which is a testament to our strong operating model.”

He said the company’s cost efficiency programme and strategic position in the Caspian region had helped sustain a robust EBITDA (earnings before interest, taxes, depreciation) delivery of $111 million at a stable margin.

“We are currently evaluating further optimisation of our operating model and cost position, without jeopardising our safety and operating standards. Direct costs are now 19 per cent lower than last year and we are closely managing our cash position. As the OSV sector challenges continues relentlessly, market recovery remains unpredictable. Charter rates have fallen sharply despite the oil price recently leveling off in the 45-50 $/bbl range. Recent production cut initiatives between Opec members is the only positive development,” said Kofod-Olsen.

He said a weak market and increased competition for spot work have brought our utilisation rate in the Mena region below 60 per cent for the nine-month period, compared to the average 85 per cent achieved in previous years. However, the company still performs above the regional average of 50 per cent.

— issacjohn@khaleejtimes.com

19% drop in direct costs than last year