SEACOR Marine reported its highest day rate since 2015 and its best vessel utilisation rates for Q2 in 10 years, as part of solid results for its quarter ended 30 June 2023 in a recovering offshore energy market
The Houston-based OSV owner had consolidated operating revenues for Q2 2023 of US$66.9M, operating income of US$2.9M, and direct vessel profit (DVP) of US$30.6M. This compares with consolidated operating revenues of US$54.0M, operating loss of US$15.5M, and DVP of US$9.9M in Q2 2022, and consolidated operating revenues of US$60.0M, operating income of US$0.2M, and DVP of US$22.7M in Q1 2023.
During Q2 2023, SEACOR Marine showed a 24% improvement in revenues from Q2 2022 and a 11% increase from Q1 2023.
SEACOR Marine’s fleet of platform supply vessels (PSVs), fast supply boats, liftboats and anchor handlers had an average utilisation rate of 78% — the highest for a second quarter since 2013, a 1% improvement from Q2 2022, and a 2% increase from Q1 2023.
SEACOR Marine reported average day rates of US$15,250, a 25% improvement from Q2 2022, and a 6% increase from Q1 2023, which was the highest day rate since Q4 2015. DVP margin increased 210% from Q2 2022 and increased 35% from Q1 2023.
For Q2 2023, net loss was US$4.6M (US$0.17 loss per basic and diluted share). This compares with a net loss for Q2 2022 of US$19.1M (US$0.72 loss per basic and diluted share). Sequentially, Q2 2023 results compare with a net loss of US$9.6M (US$0.36 loss per basic and diluted share) in Q1 2023.
Reflecting on the results, SEACOR Marine chief executive John Gellert was understandably optimistic. “The cyclical recovery continued with another consecutive quarter of improved average day rates and utilisation. More importantly, the second quarter produced meaningful cash flows from operations through a strong conversion rate with the highest DVP the company has generated since 2014,” he said.
Mr Gellert explained, “The increase in DVP was primarily due to higher day rates and utilisation as well as lower operating expenses. This quarterly improvement was driven by our international business segments, most notably Africa and Europe, which have been virtually sold out during the quarter, and the Middle East. We also continued to make progress in Latin America, despite slightly lower utilisation due to scheduled drydockings.”
During the quarter, SEACOR Marine’s US business was “hampered” by “low activity levels on the shelf of the Gulf of Mexico, driven in part by the bankruptcy of a significant operator, as well as delays in contract start-ups for several offshore wind contracts in the northeast,” he said. He also noted one of SEACOR Marine’s premium liftboats in the US remained off-hire for extended repairs, which is expected to return to service following completion of those repairs in H2 2023.
SEACOR Marine refinanced debt on 20 June associated with three battery-hybrid PSVs it acquired with shipyard financing during the trough of the cycle. “We will continue to address near-term maturities and opportunistically pursue refinancing opportunities that reflect the improved outlook for the business,” said Mr Gellert.
He concluded, “I am optimistic about our ability to continue to improve our profitability in the current cycle given the margin available to improve utilisation and the fact average day rates have yet to reflect full cycle dynamics.”
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