Otto Marine sinks into the red for Q2

SINGAPORE - Offshore marine group Otto Marine booked a second-quarter net loss of US$2.72 million compared to a US$16.86 million profit for the year-ago period, on lower revenue and higher finance costs.

Revenue fell 36.4 per cent to US$71.22 million in the quarter as all its business segments contributed lower revenue.

Loss per share came to 0.06 US cent, compared to earnings per share of 0.41 US cent previously.

Finance costs surged 59.7 per cent to US$9.21 million, from US$5.77 million previously.

For the first half-year, Otto Marine suffered a net loss of US$15.95 million versus a profit of US$2.48 million a year ago, despite revenue rising 15.9 per cent to US$219.27 million. This came as its other income during the period plunged by US$8.96 million to US$4.48 million.

"It has been a tough time for the industry, and we have rolled out a series of measures in marketing and operation to ensure optimal performance in this challenging environment," Group CEO Michael See said in a statement.

Mr See noted that the shipyard segment has remained profitable, while the shipping and chartering segments would need more efforts in terms of securing new chartering orders and improving utilisation rate.

He also observed that Australia has been a stable market for chartering as supported by mainly LNG projects. In the North Sea market, the company maintains a reasonably healthy utilisation rate for its vessels which are mainly larger size, deepwater vessels.

"Latin America and Africa markets see better performance than Asia," he added.

As at end-June, Otto Marine has orders in hand worth US$307.2 million, boosted by the US$132.2 million new chartering contracts added in the second quarter this year.

It added that while the group reduced its fleet size in view of the depressed market conditions, it has secured new charter orders which have brought the utilization rate from 59.2 per cent for the first quarter to 74.0 per cent for the second quarter.