Seacor Holdings intends to spend more than US$67M in 2020 on constructing new vessels and drydockings
The US-based owner of tugs, barges, tankers and ferries will continue its capital and operational expenditure despite its business being affected by coronavirus restrictions in the US.
Seacor’s capital commitment as of 1 April 2020 was US$61M which includes construction payments for four US-flag harbour tugs, the company’s interest in six new inland river dry-cargo barges, two inland river towboats and two foreign-flag rail ferries.
It is also investing in vessel and terminal improvements, while a further US$1.1M has been committed for other property and equipment. US$5.5M has been earmarked for drydockings.
In December 2019, Seacor contracted Alabama-based Master Boat Builders to construct four 80-tonne bollard pull harbour tugs, with an expected delivery in 2021 and Q1 2022.
High drydocking costs impacted Seacor’s Q1 2020 results as it prepared for enhanced operations this year.
Seacor Holdings executive chairman Charles Fabrikant said, “The primary cause for the large swing in cash earnings relates to performing periodic, heavy maintenance for some of our vessels.”
Net income attributable to stockholders Q1 2020 was US$1.5M, compared with US$7.7M for the same period in 2019. Seacor’s Q1 2020 operating results were impacted by a US$6.7M increase in drydocking costs, which included major overhauls for five harbour tugs and installing a ballast water treatment system for a US-flag petroleum and chemical carrier.
Mr Fabrikant said Seacor’s operations would continue despite challenges on services caused by Covid-19.
“We are taking enhanced precautions in response to the unprecedented challenges of Covid-19,” said Mr Fabrikant. “We look to local, state and federal directives and follow best practices.”
He said all Seacor operations were deemed essential. “Our ships, tugs and warehouses continue to fulfil their mission of transporting and distributing essential goods,” Mr Fabrikant said. “The Covid-19 pandemic had a limited impact on our first quarter financial performance,” he continued.
“Our diversified services dampened, and, hopefully, will continue to mitigate for us the severe economic fallout of Covid-19 on the economy.”
Seacor’s SCF barges continue to move grain on inland waterways and its terminals transfer agricultural and industrial essentials.
“Our harbour tugs continue docking ships with inbound goods and exports,” said Mr Fabrikant.
The group’s oil storage facility in Granite City, Illinois, is fully utilised for the first time in many months.
Seacor’s SEA-Vista Jones Act tanker business benefits from charters that extend through to 2021. But, its liner and logistics support for the Bahamas and Caribbean, Seacor Island Lines, and government services subsidiary, Waterman Steamship, have experienced weaker demand.
“The Bahamas, like the US, has a ‘shelter in place’ order in effect and in April the US military instituted a moratorium on movements of cargo handled by vessels such as ours,” said Mr Fabrikant.
Seacor recorded an operating loss of US$0.1M in Q2 2020, compared with operating income of US$19M in the same period last year.
Seacor operates 33 harbour tugs, one oceangoing tug and 24 other harbour boats. It also operates 25 towboats, 1,397 dry cargo barges, 20 liquid transportation barges, nine chemical and product tankers and two bulk carriers.
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