SINGAPORE (May 12): Vard Holdings, the offshore and specialised vessel builder, has posted a loss of NOK27 million ($4.4 million) for the first quarter ended March 31 compared to a gain of NOK43 million in the same period a year ago.
Revenue for the quarter fell 12% to NOK1.8 billion from NOK2 billion in 1Q16, mainly due to reduced activity, especially at the group’s Norwegian yards after it ceased operations in Vard Niterói during 2Q16.
An EBITDA before restructuring cost of NOK40 million was recorded in 1Q compared to NOK57 million recorded the year before, such that EBITDA margin decreased to 2.3% from 2.8% the previous year.
As at end March, cash and cash equivalents were NOK908 million, 26% higher from NOK722 million the year before driven by vessel deliveries and instalments received on other projects.
Cash flows used in investing activities amounted to NOK93 million in 1Q17 compared to NOK35 million the year before, with investments in property, plant and equipment during the first quarter being mainly related to the expansion of facilities at Vard Tulcea.
Cash flows from financing activities was NOK56 million positive compared to the negative NOK52 million in 1Q16, and te group has not obtained any new loans during the quarter.
Vard highlights that it has received four new orders amounting to NOK1.9 billion, and delivered two offshore vessels over the quarter.
Its order book currently amounts to NOK13 billion, up from NOK12.7 billion as at end-2016.
The group notes healthy demand in the exploration cruise vessel segment, but continues to be aware of “nascent interest” for individual vessel types in the offshore sector, although the group says demand still appears too sporadic to constitute a trend.
“Our diversification strategy continues to yield positive results, as evidenced by the orders we have received for various specialized vessels. As we progress with modest growth in our order book, we are exploring how our expertise can be deployed to other vessel types. Whilst seeking out new project opportunities, we remain focused on ensuring that our project portfolio is sustainable, and mitigating the associated risks,” says Roy Reite, CEO and executive director of Vard.
Shares of Vard closed flat at 25 cents on Thursday.
