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Swissco foresees weak offshore market for the rest of 2016, books Q1 loss

Swissco foresees weak offshore market for the rest of 2016, books Q1 loss
The depressed offshore oil and gas industry is expected to stay weak for the rest of this year, Swissco Holdings noted, as the company slipped to a first quarter net loss.

Offshore services firm Swissco said oil companies’ capital spending will continue to decline, and charter day rates are likely to remain depressed.

The industry is also experiencing excess offshore rigs supply, with many rigs likely to remain idle for a protracted period.

“The group will focus on its efforts to maintain adequate liquidity and to secure any charter contract opportunities that become available,” said Tan Fuh Gih, executive director of Swissco.

“As for the OSV segment, the group will streamline its operations to improve efficiency and reduce its operating costs. Marketing effrots are stepped up to improve its vessels’ utilisation rate,” Tan said.

Singapore-listed Swissco was hit by a first quarter loss of $1.91m as against the profit of $21.88m in the previous corresponding period.

The deficit was mainly attributed to a forex loss of $4.47m and a loss on disposal of vessels of $260,000.

Revenue for the quarter plunged by 74.8% year-on-year to $4.8m due mainly to lower vessel utilisation and charter day rates.