Viking Supply Ships finalizes financial restructuring

Supply shipping company Viking Supply Ships informed on Thursday it has concluded its financial restructuring providing the company with a stable financial platform until 2020. 

Viking Supply Ships AB is a Swedish company headquartered in Gothenburg, Sweden and Viking Supply Ships A/S (VSS A/S) is its subsidiary providing PSV and AHTS vessels for the international oil and gas industry.

Back in June 2016, Norseman Offshore, a single-purpose company that owned the AHTS vessel Odin Viking which was under bareboat charter with Viking Supply Ships, filed an application for bankruptcy against VSS due to an unpaid hire for the vessel, only to withdraw it a week later.

Instead, on October 18, 2016, a bankruptcy petition was approved towards Norseman, the owner of the AHTS vessel Odin Viking. On November 9 Odin Viking SPV AS, a company owned by Kistefos AS, concluded on an agreement with the bankruptcy trustee, where after Odin Viking SPV AS bought the Odin Viking and acquired the bareboat charter party. Odin Viking SPV AS and Viking Supply Ships A/S subsequently made an agreement to amend the terms in the bareboat charter party, including a significant reduction in the bareboat rate.

The company said on Thursday that this finalized the financial restructuring of VSS A/S, subject to an equity issue at an agreed level in Viking Supply Ships AB and a subsequent equity injection by the parent company into VSS A/S. The equity issue is expected to be finalized before year-end 2016. The company said that the restructuring will provide VSS A/S with a stable financial platform until 2020, subject certain vessel income levels.

The company also reported that total revenue for VSS A/S for 3Q 2016 was $27.6 million, compared to $27.2 million in the same period last year. Out of this, vessel operations contribute with $23.5 million and Services and Ship Management segments contribute with $4.1 million.

The net result for 3Q was a loss of $9 million, compared to a loss of $29.5 million for the corresponding period last year. The result for the third quarter this year was negatively impacted by an unrealized currency loss of $5 million and an impairment loss on the PSV fleet of $6.5 million.

The average utilization in 3Q 2016 was 65% for the AHTS fleet and 0% for the PSV fleet as its whole fleet is in lay-up. In the same period last year, AHTS fleet utilization was 63% while the PSV fleet utilization was 39%.

Bengt A. Rem, CEO and President, said: “VSS A/S anticipates that the general offshore market will remain challenging through 2017 due to oversupply within the industry.

“There is, however, positive indications that the activity level within important core areas to VSS A/S, such as the Barents Sea and Canada will increase, which will be of significant importance for the company.”

Offshore Energy Today Staff