Seatrade Maritime is part of the Informa Markets Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

MES earnings hit by offshore vessel jobs

MES earnings hit by offshore vessel jobs
Mitsui Engineering & Shipbuilding Co (MES) has recorded a significant fall in net profit for its nine-month results ended 31 December 2015, due mainly to poor performance at its ship and ocean division.

Profit for the first nine months of 2015 was registered at JPY2.48bn ($21.03m), a fall of 73.2% compared to JPY9.25bn in the previous corresponding period.

Revenue during the period, however, rose by 5.3% year-on-year to JPY587.59bn.

The ship and ocean division at MES flipped to an operating loss of JPY11.29bn as against the profit of JPY4.21bn in the year-ago period, while the group’s other divisions such as machinery, engineering and others remained profitable.

MES said it has recognised losses of JPY3.8bn on construction of four OSVs during its second quarter due to repeated design changes and problems. Additional losses of JPY7.2bn have been anticipated, including provision for losses during the third quarter for increases in materials and man hours.

Looking ahead, MES has projected a full year revenue of JPY810bn and a profit of JPY6bn. The latest projection was revised down from an earlier forecast revenue of JPY830bn and profit of JPY13bn.

“Net sales are trending generally according to plan despite the fact that net sales for the ship and ocean segment will fall slightly short of our original forecast,” MES stated.