SINGAPORE (July 25): Vard Holdings saw its losses widen to NOK 69 million ($11.7 million) for the second quarter ended June, from losses of NOK 53 million a year ago.
This was mainly attributable to foreign exchange losses. In the first half of 2017, Vard recorded a net foreign exchange loss of NOK 22 million, compared to a net foreign exchange gain of NOK 138 million in the same period last year.
NOK 12 million of the foreign exchange losses in 2Q was due to the yard construction loan in Vard Promar, which was denominated in US dollars.
In addition, losses from share of results of associates nearly doubled to NOK 17 million 2Q due to the losses in associated ship-owning entities amid the continued downturn in the offshore market.
Revenue in 2Q dipped 4% to NOK 2.1 billion, from NOK 2.2 billion a year ago.
The decline was mainly due to reduced activity, especially at the Norwegian yards, as well as the cessation of operations in Vard Niterói during 3Q last year.
Cash and cash equivalents stood at NOK 694 as at June 30, 2017.
In a separate announcement on Tuesday, Vard says a Letter of Intent for an exploration cruise vessel signed in January 2017 has expired without resulting in a firm contract.
However, Vard says there are still unrealized opportunities for the group in this segment.
“Vard’s business transition continues to progress amidst challenging market conditions,” says CEO and executive director Roy Reite. “Vard has adopted a two-pronged approach in sustaining its efficiency by fostering and exploring new opportunities in diverse markets, whilst internally working towards stabilizing workloads across the different shipyards.”
“With long-standing experience in the design and construction of highly specialized vessels, Vard is well placed to tap on unrealized opportunities in various new market segments,” he adds.
Shares of Vard Holdings last closed at 24.5 cents on Monday.
