Sembmarine expects losses to continue for this year

Firm still faces supply chain issues, shortage of skilled workers due to border restrictions

Sembcorp Marine's Tuas Boulevard Yard. The offshore and marine company yesterday announced an existing order book of over $1.89 billion, which includes $290 million of ongoing repairs and upgrades for delivery this year. The group is also actively te
Sembcorp Marine's Tuas Boulevard Yard. The offshore and marine company yesterday announced an existing order book of over $1.89 billion, which includes $290 million of ongoing repairs and upgrades for delivery this year. The group is also actively tendering for more than 10 projects, especially in the renewable energy and gas solutions segment. PHOTO: LIANHE ZAOBAO

Mainboard-listed Sembcorp Marine (Sembmarine) said yesterday in an interim business update that it expects losses to continue for its current financial year.

The offshore and marine company continues to face Covid-19 supply chain constraints and a shortage of skilled workers, as foreign workers who left Singapore over the past year have been unable to return due to ongoing border controls in countries such as India and Bangladesh.

The shortage of skilled workers has impacted the execution and schedule completion of some of the group's projects, the group said in a bourse filing.

That being said, there have been no cancellations to date of any existing projects, it said.

Sembmarine added that it is actively sourcing skilled workers from other countries and is working with the authorities to expedite their entry into Singapore.

It also announced an existing order book of more than $1.89 billion, which includes $290 million of ongoing repairs and upgrades for delivery this year.

The group is actively tendering for more than 10 projects, especially in the renewable energy and gas solutions segment.

A similar number of tenders is in progress for the process solutions segment, covering floating production, storage and offloading vessels, floating production units, and floating storage and offloading vessels.

Said the company: "On future orders, the market sentiment has improved, although the post-Covid-19 recovery remains uncertain. There are increasing signs of active reviews of FIDs (final investment decisions) and improved orders visibility. However, competition for new projects remains intense."

Notwithstanding the challenging operating environment, Sembmarine said its strategic investments have positioned it well for the global transition to a low-carbon economy, and pivot towards cleaner and greener energy sources.

Subject to ongoing support from its lenders, the group expects to have the necessary liquidity to fund its operations for the foreseeable future.

As at end March, its net debt to equity was 0.74 times.

Sembmarine shares closed at 20 cents yesterday, down 2.38 per cent.

THE BUSINESS TIMES

• Additional information from The Straits Times

A version of this article appeared in the print edition of The Straits Times on May 04, 2021, with the headline 'Sembmarine expects losses to continue for this year'. Subscribe