Sembcorp Marine has slashed the red ink in the first half of 2022 as it prepares for its merger with Keppel Corp’s offshore and marine division.
The Singapore-listed yard group said it lost SGD 143m ($104m) for the January to June period against a loss of SGD 647m 12 months ago.
“The first-half loss was due to lower than breakeven activity volume, as existing orders are completed and new orders secured would only start contributing to revenue in subsequent periods,” Sembcorp Marine said.
Residual Covid-19 challenges also contributed to one-off increases in cost provisions and overheads in the first half of the year, it added.
The group recorded revenue of S$1.1bn for the six months ended 30 June 2022, an increase of 30% compared to the corresponding period in the prior year.
This was attributed to “positive outcomes for project completion terms with key customers, as well as initial contributions from new projects”.
The first half of the year saw Sembcorp Marine’s net order book cross the SGD 2.5bn mark, with SGD 1.9bn of new contract wins during the period under review.
Among the high-profile projects secured was Sembcorp Marine’s first order for a wind turbine installation vessel (WTIV), which was ordered by Maersk.
Sembcorp Marine said overall order visibility had “progressively improved” since the beginning of the year, underpinned by rising oil prices and renewed concerns about energy security in the wake of geopolitical tensions.
“Oil and gas companies and energy suppliers have picked up pace in reviewing ongoing new projects and previously deferred activities,” the company said.
The group’s repairs and upgrades business continued to improve, with a total of 96 vessels serviced in the first half of 2022.
“With natural gas featuring significantly in the marine industry’s net-zero emissions ambition, the group saw continued demand for repair and upgrade of LNG carriers,” Sembcorp Marine said.
In the year to date, Sembcorp Marine said it had completed 10 LNG carrier repairs and refits as well as the upgrading of two floating storage regasification units.
Looking ahead, Sembcorp Marine said it was close to completing the construction of the largest LNG bunker vessel built in Singapore, for Mitsui OSK Lines and charterer Pavilion Energy.
Launched in April 2022, the newbuild 12,000-cbm vessel is scheduled to undergo sea and gas trials before its scheduled delivery at the end of the year.