Topaz Energy and Marine on Monday said that profit had held steady in the first quarter of the year, even as revenue and ship utilisation dropped further.
The Dubai-headquartered shipping company, which is a wholly owned subsidiary of Muscat-listed Renaissance Services, reported earnings before interest, tax, depreciation and amortization of US$39.7 million for the first three months, little changed from last year’s $39.4m.
The overall business remained pressured by weak conditions that prevailed in the oil infrastructure business in the first quarter, with revenue depressed by about 9 per cent at just below $78m.
The company reported in March that revenues fell last year by 10 per cent to about $363m.
“As expected, the first quarter of the year has proved challenging,” said the Topaz chief executive René Kofod-Olsen.
The decline in revenue was “mainly due to increasing competition which is putting downward pressure on rates and affecting utilisation in Mena and our nascent business in Africa”, he said.
As with many companies in the oil industry, Topaz has been cutting costs to protect margins.
Topaz has used price declines also to expand its fleet and Mr Kofod-Olsen noted the company’s successes in its core market of Azerbaijan.
“So far in 2016, we have secured two landmark contracts, together bringing our backlog to $1.6 billion,” he said.
“We signed long-term contracts with BP for 14 vessels in Azerbaijan, and a $350m contract with TCO in Kazakhstan to construct, supply and operate 15 vessels for a minimum period of three years.”
amcauley@thenational.ae
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