Otto Marine secures contracts worth US$131m to date in fiscal Q2

SINGAPORE - Mainboard-listed offshore marine company Otto Marine said on Monday that it has secured orders worth US$131 million (S$177.33 million), mainly in the chartering business, to date in the second quarter of its 2015 financial year.

"The substantial increase in new chartering contracts was attributable to the group's strategy to improve the utilisation rate of the fleet, in view of the potential cost that idle vessels will incur," the company said in a filing with the Singapore Exchange.

Utilisation rate for the group's chartering business has also improved for Q2FY15 against the last few quarters, it added.

Said Otto Marine chief executive officer Michael See: "While some of the chartering rate is under pressure, it is still in the best interest of our group to secure better utilisation of our vessels than leaving them idle."

According to Mr See, Australia has been a much more stable market for chartering as supported by liquefied natural gas projects.

He added that Otto Marine is one of the very few Asian operators working for the North Sea market, where it still maintains a reasonably healthy utilisation rate, as it has large-sized, DNV-class vessels capable to operate in deep water.

At the same time, Latin America and African markets are performing much more steadily than Asia, he said.

"We retain good flexibility in managing our fleet size. While we enjoy better profit from our own vessels, we can return chartered-in vessels at expiration, and charter in additional, more technologically advanced vessels that bring in immediate contracts," he added.