Denmark's Esvagt is halting investments and cutting pay to cope with the downturn in the European oil and gas sector.
The shipowner said liquidity is coming under pressure as demand for its 46 vessels drops.
The company wants to meet the consequences of decreasing energy prices and the coronavirus pandemic through a streamlining process that will ensure it can continue to support "vital infrastructural energy production", Esvagt said.
"Our oil and gas business is challenged in two essential areas of the current situation," said chief executive Peter Lytzen.
"The fact that oil storage is full and oil and gas prices are low means that no investments are being made in well drillings."
He added that the situation is having an impact on the emergency response and rescue (ERRV) spot market, which is a key business area for Esvagt.
"At the same time, our rates are affected by exchange losses from the Norwegian krone and the British pound, two markets where Esvagt has a substantial presence," he said.
Havyard troubles hit Esvagt
Esvagt has also had to contribute to an economic rescue package for Norwegian shipyard group Havyard, whose shipbuilding subsidiary Havyard Ship Technology has been placed into bankruptcy.
Esvagt has three accommodation ships for the wind power sector on order there.
What the company called the "financial whirlwind" at the yard means the vessels will be delayed, but it did not go into details.
"All in all, these are elements that put Esvagt's liquidity under pressure. We have to relate to this," said Lytzen.
Directors and senior managers are taking a 15% cut for a year, while other managers are losing 10% of their pay.
Onshore staff have been consulted about a voluntary 5% cut.
"There is a genuine understanding from the shipping company’s over 1,000 offshore employees that in times like these, large pay adjustments aren’t expected," Esvagt added.
Lytzen said the outfit has to balance its responsibility to keep employees while ensuring healthy operations.
"We do not wish to send people home, and we can't, because we have a responsibility as a subcontractor to society’s crucial energy infrastructure," he said.
The company also said some unspecified investments have been postponed and some ships "decommissioned."
Contracts under scrutiny
In addition, it will renegotiate contracts with partners and suppliers.
The company says it needs backing and support from subcontractors.
"It is my impression that the strong public spirit, which has been a solace during the corona pandemic, also applies across the industry. I am witnessing an understanding that we need to stand together in order to get through the current challenges," said Lytzen.
The fleet includes six operational accommodation ships, an anchor-handling tug supply (AHTS) vessel and the ERRVs.
Clarksons lists the Havyard newbuildings as due this year and in 2021.
