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Pacific Radiance posts $121.7m loss in 2016 on impairment charges

Pacific Radiance posts $121.7m loss in 2016 on impairment charges

OSV owner Pacific Radiance has been hit by an annual loss of $121.68m due mainly to $52.2m in impairment charges as a result of the difficult offshore market.

The 2016 loss recorded by Singapore-listed Pacific Radiance erased its profit of $3.68m made in 2015.

The company’s $52.2m in impairment charges for last year included provisions of $28.7m for its directly-owned fleet and $23.5m for doubtful receivables.

Full year revenue was registered at $69.42m, a drop of 43% year-on-year due primarily to lower vessel utilisation and charter rates.

Pacific Radiance expects results over the next 12 months to continue to be under pressure in view of challenging conditions ahead in the oil and gas market.

“We anticipate a slow recovery in the market with the widely expected balance in the oil supply and demand gap by the second half of 2017,” commented Pang Yoke Min, executive chairman of Pacific Radiance.

“Until then, the group will continue to weather the headwinds by maintaining an efficient cost structure without hampering our operations, and strengthen our presence in key markets,” Pang said.

In January, Pacific Radiance announced that it landed multi-year contracts worth up to $68m, including options, for offshore work in the Middle East, one of its key target markets.

Pang added that the group is currently working closely with its main lenders to enhance its liquidity position.

In October 2016, Pacific Radiance won backing by its bankers to refinanced its existing term loans and renewed revolving credit facilities totalling approximately $185m. The extension of the term loans from seven to 12 years will reduce the group’s principal repayments by about $103m through to 2019.

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