Damen expects 2014 revenues to nudge $2.7bn mark

“We will come close to EUR2bn in revenues [in 2014] this year we made EUR1.8bn,” said Kommer Damen, chairman of DSG, speaking at an inauguration ceremony of its new yard in the UAE. The ceremony conducted by the Ruler of the emirate of Sharjah, Sheikh Sultan bin Mohammed Al Qasimi, to declare Damen Shipyards Sharjah (DSS), located at Hamriya Port and Free Zone, officially open.

Expected to publish 2013 results shortly, DSG, which owns 38 yards worldwide, including 16 in The Netherlands, saw an annual turnover of EUR1.7Bn in 2012. It delivered 157 vessels in 2012, including 80 tugs and workboats, and 42 high-speed craft and ferries. It builds 150 craft a year on average and keeps 150 hulls in stock.

"We have to produce closer to our markets for the medium-sized vessels because we see that transportation costs of our production yards to some markets are becoming high due to increasing fuel costs," said Damen. "If we produce in China or Vietnam [for elsewhere], costs are substantial."

Damen singled out the Gulf of Mexico, the Middle East and West Africa as markets with good prospects in 2014. He said DSG was looking to set up a new yard to serve West Africa and was currently operating out of an existing facility in Cape Town.

Damen, who bought the business from his founder father Jan in 1969, is credited with introducing the concept of standardised hulls, allowing DSG to deliver “off-the-shelf” products more quickly to market.

"Not all markets are free," he said, referring to business with partner yards in Brazil. "We try to produce in the medium-size ships closer to the market. I have a good feeling about our business prospects," he said. "If there is growth, there are opportunities for everyone."

DSS is a joint venture between DSG and the UAE’s Albwardy Marine Engineering. The yard, on which construction began in 2011, offers repair and construction of all type of vessels, and has recently delivered tugs, workboats, support vessels, dredgers, landing craft, floating docks, barges and pontoons.

DSS expects to deliver 17 newbuilds this year. “Our goal is to deliver [at least] one vessel a month,” said Lars Seistrup, DSS’s managing director. Officials attending the event said DSS was attracting new interest from global navies’ border and patrol units, which were studying group products due to improved pricing, technology and efficiency.

Hamriyah Port was initially developed in the 1980’s for liquefied petroleum gas export, but has blossomed into a fully-fledged oil and gas and offshore support centre. Harbour Master Capt. Moatasim Defalla Elnur said that a quay wall of 1,150 m for bulk cargoes of oil, steel and grain was now insufficient to deal with volumes, and that 1,600 m of new quay wall would be added in 2016.

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