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COSL expects to greatly narrow first half loss

COSL expects to greatly narrow first half loss
China Oilfield Services Limited (COSL) is expected to significantly narrow its first half loss compared to the year-ago period, due partly to improved asset utilisation and increased contributions from its technology business.

Hong Kong-listed COSL has estimated a loss of RMB370m ($55.76m) for the first half ended 30 June 2017, compared to the bigger loss of RMB8.4bn in the previous corresponding period.

COSL highlighted that during the first half, the company has consolidated and expanded to domestic and overseas markets. It also raised the utilisation rate of its equipment sector and the contribution ratio of its technology sector.

“The company is actively taking a variety of measures to increase the utilisation rate of the equipment sector, and to accelerate technology sector’s pace of industrialisation,” COSL said.

“While seeking ways to increase profits, the company has also achieved cost reduction through management measures in areas such as equipment’s self-repairing enhancement and procurement methords optimisation,” it added.

The projected narrower loss was also due to the company having provided for impairment of fixed assets and goodwill amounting to RMB7.14bn in the first half of last year, while such provisions have not occurred for the first half of this year.

The global oilfield services industry continues to face steep challenges and a bleak outlook due to reduced offshore work volumes. COSL operates a fleet comprising of drilling rigs, jack-ups, semi-submersible drilling rigs, module rigs and accommodation rigs.