Norway: BW Offshore Sees Strong Outlook

BW Offshore, a global provider of floating production storage and offloading (FPSO) vessels to the oil and gas industry reported that the company’s operating revenues for the first quarter of 2012 amounted to USD 217.5 million, an increase of USD 9.4 million compared to USD 208.1 million in the fourth quarter of 2011.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) for the quarter amounted to USD 69.2 million, compared to USD 72.8 million in the previous quarter. The decrease in EBITDA is mainly a result of negative contribution from the Papa Terra project of USD 10.3 million, offset by insurance settlement of USD 6.4 million for loss of hire from Ningaloo Vision in the first quarter. Net profit amounted to USD 3.4 million for the quarter compared to a net loss of USD 151.7 million in the previous quarter.

Net debt amounted to USD 1,734.4 million at 31 March 2012, compared to USD 1,702.4 million at 31 December 2011. The equity ratio was 33.5% at the end of the quarter, up from 32.4% in the previous quarter.

Operations and projects

The FPSO BW Pioneer commenced operation and received full day rate from mid-March 2012. The FPSO Polvo experienced some downtime in the quarter related to problems with the boilers. All other operating units had high and stable performance during the first quarter with an average uptime of 97.5%.

BW Joko Tole arrived on location offshore Indonesia on 6th of April 2012 and has been hooked up to its mooring. The FPSO is now completing installation and commissioning activities. The FPSO BW Athena arrived on location offshore UK and was hooked up to the preinstalled STP buoy on 8th April 2012.

Including ongoing conversions and after the sale of the FPSO Ningaloo Vision, BW Offshore’s fleet consists of 14 FPSOs and 2 FSOs.

The EPC conversion project for the FPSO P-63 (Papa Terra) is under construction in China being readied for a third quarter departure before final hookup and commissioning in Brazil.

Outlook

The outlook for the energy market in general and BW Offshore’s position in particular remains strong. Based on BW Offshore’s diversification, presence, financial scale and competence, the Company’s aim is to continue to play a significant role in the FPSO market with profitable growth.

BW Offshore’s cash flow from the operating vessels is secure and based on long term contracts with large national oil companies and solid independent oil companies.  The commencement of operation for the FPSOs BW Athena, BW Joko Tole, as well as the recent commencement of production from BW Pioneer, will contribute significantly to growing the EBITDA in 2012 and beyond. BW Offshore is currently pursuing several prospective projects that meet the Company’s financial targets. The Board has declared a cash dividend of USD 0.02 per share for the quarter.

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Source: BW Offshore, May 10, 2012