Sembcorp Marine (SembMarine) has reported a deeper net loss of $523.3 million for the 2HFY2021 ended December, 34.1% higher than the net loss of $390.4 million.
This brings FY2021’s loss wider to $1.17 billion from the loss of $582.5 million in the FY2020. This was mainly due to the push-out of delivery for its ongoing projects, with significantly higher provisions for manpower and other costs to complete most of the projects during the year and over the next six to nine months. The total net loss took into account cost provisions of $839 million.
Excluding the provisions, FY2021 would’ve seen a net loss of $332 million, an improve of 24% compared to FY2020’s net loss of $439 million.
Loss per share for the 2HFY2021 and FY2021 stood at 2.27 cents and 6.49 cents respectively.
“While we managed to reduce our second half losses compared to the first half, our financial results for the full year reflected the continuing impact of the pandemic which accounted for the significantly higher provisions for manpower and other costs to complete our projects,” says president and CEO Wong Weng Sun at SembMarine’s results briefing.
The pandemic may have been challenging for the group, but it has “given us the impetus to find solutions, new way to approach issues and take concrete steps to address each evolving challenge. We took active measures, worked in even tighter cooperation with our customers and found a new rhythm to manage the pandemic and our operation. The labour shortage situation also stabilised during the fourth quarter to enable smoother execution of projects,” Wong adds.
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2HFY2021 revenue improved by 68.5% y-o-y to $1.02 billion mainly due to higher revenue recognition from rigs & floaters and offshore platform projects.
However, 2HFY2021 saw a gross loss of $494.1 million, 67% y-o-y more than the gross loss of $295.9 million in the 2HFY2020 as Covid-19 disruptions caused further delays and increase in manpower and other related costs to complete existing projects.
As at end-December, cash and cash equivalents stood at $1.1 billion, mainly due to the net proceeds from its rights issue.
In FY2021 and year-to-date 2022, SembMarine successfully delivered four major projects, including the newbuild floating production unit (FPU) for the Vito Regional Production Facility (RPF) for Shell Offshore Inc.
As at end-December, the group has a total of 16 key projects under execution with 12 slated for completion in 2022.
In its outlook statement, SembMarine says the industry outlook for the oil & gas, renewables and other green solutions will continue to improve.
“It is important for the group to convert its orders pipeline into firm contracts on a timely basis in FY2022,” it says.
It adds that it expects its financial performance in FY2022 to be “significantly better” compared to its figures in FY2021.
Shares in SembMarine closed 0.1 cent higher or 1.19% up at 8.5 cents on Feb 25.
Photo: Bloomberg
