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Vard hit by $4.2m loss in H1

Vard hit by $4.2m loss in H1
Offshore vessels builder Vard Holdings has posted a loss of NOK34m ($4.2m) in the first half compared to a profit in the year-ago period, as the weak offshore oil and gas sector continues to weight on global offshore vessel demand.

The loss in the first half ended 30 June 2015 was a reversal of fortune from the profit of NOK232m registered in the same period of last year.

Revenue in the first six months stood at NOK5.55bn, inching down 1.1% from NOK5.61bn in the previous corresponding period.

The company said it faced a slowdown in activity at some yards during the second quarter as the overall weakness in the oil and gas sector began to impact operations.

Orderbook development remained muted, with one new vessel order secured by the group during the second quarter.

At the end of the second quarter, its orderbook value stood at NOK13.92bn, representing a 10.9% decline from the preceding quarter, and a 35.6% decrease from the same period in the preceding year. This corresponds to an orderbook of 29 vessels.

“As we work through the necessary adjustments in our organisation to address the challenges posed by the market, we continue to focus on R&D and new business development to reinforce Vard’s position,” said Roy Reite, ceo and executive director of Vard.

Vard has implemented strict cost-cutting programme including reduction of overheads and lessening the use of outsourced and subcontracted labour.

Despite the overall weak near-term outlook, Vard sees opportunities in some specialised segments, both within offshore and in other niche markets.