Americas News
"Improving Health" of Industry Raises OSV Firm's Profits
U.S.-based Offshore Service Vessel (OSV) provider Tidewater Inc. [NYSE:TDW] (Tidewater) reports that it made a profit of $150.8 million on revenues of $1,244.2 million in its 2013 fiscal year, ended March 31, 2013, compared with a profit of $87.4 million on revenues of $1,067 million for the previous year.
The cost of fuel, lube, and supplies was up for the year, to $79.0 million compared to $76.9 million for the previous year, but that line item represented just 6 percent of vessel revenues compared with 7 percent in FY 2012.
Vessel revenues for the fourth quarter hit $325 million, up 13 percent from the same period last year.
"Our vessel revenues reflect the improving health of our industry ... and the fruits of our continued investment on our vessel fleet over the past several years," President and CEO Jeffrey M. Platt said in an earnings call.
The company recently purchased Troms Offshore Supply of Norway for about $395 million, adding five modern platform supply vessels (PSVs) to the company's fleet and giving it a foothold in the Norwegian North Sea.
"Troms's vessels and, more importantly, their experienced management team and employees will provide us with the increased capability to work in harsh environments and in cold climates such as the Arctic, where oiling companies are targeting exploration," Platt said.
Tidewater now has a total of 230 new vessels, representing more than 85 percent of its active vessel fleet.
"Although these new, larger and more technically advanced vessels have enabled us to earn higher day rates, they cost more to build or acquire and they are more expensive to maintain," Platt said.
"When one of these vessels goes into a shipyard for a regulatory drydocking or other extended work, we experience a significant short-term revenue loss associated with the vessel's down time, coupled with the cost of the drydock, which we expense at the time our vessel enters the yard."
Looking into the future, Platt said offshore exploration and development is likely to remain a healthy sector.
"With commodity prices remaining strong, oil company cash flows remain healthy and the companies appear to be willing to spend more money on exploration and development," he said.
"We see nothing to suggest any retrenchment in spending."
