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CH Offshore sees first half profit chopped

CH Offshore sees first half profit chopped
CH Offshore saw its first half net profit chopped amid the challenging offshore market marked by low demand and charter rates.

Profit for the six months ended 31 December 2015 was recorded at $2.28m, a plunge of 79.3% from $11m registered in the same period of 2014.

First half revenue dropped by 37% year-on-year to $11.25m due mainly to lower vessel utilisation and charter rate reduction. A vessel was off-hired for mandatory overhaul and another two vessels only secured intermittent spot jobs.

“The offshore support industry remains challenging. The continued low oil price has caused exploration and production companies to reduce their capital spending for offshore projects, which has resulted in a decrease in activity for offshore support vessels,” Singapore-listed CH Offshore said.

“Overall fleet utilisation for the offshore support industry has fallen significantly, increasing the number of available vessels that are pursuing the fewer opportunities. As a result, there is significant competition for offshore projects, leading to a decrease in the day rates available for OSVs,” it added.

The offshore industry is expected to remain under pressure as the low oil price environment may persist through 2016 and beyond, the company said.