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GMS swings into profit as day rates climb

Photo: GMS GMS Enterprise in Abu Dhabi - Copy.jpg
London-listed Gulf Marine Services (GMS), an operator of self-propelled, self-elevating support vessels deployed in the oil, gas and renewable energy sectors has announced a 2021 net profit of $31.2m, its first positive result since 2016

The dramatic turnround from a loss of $124.3m the previous year was a result of various factors, but increased utilisation and firmer day rates of the company’s E- and S-Class units were key factors. Revenue rose by 12.3% to $115.1m, EBITDA increased to $64.1m from $50.4m in 2020, and adjusted EBITDA margin climbed from 49% that year to 56%.

The company undertook a successful equity issue in June 2021. This resolved previous uncertainty and removed the risk of a potential default on bank debt. A subsequent refinancing resulted in significant savings in finance costs, with interest rates reduced from 5% to 3%, and margin from 1% to 0.2%.

Average fleet utilisation rose four percentage points to 85%, with medium-sized S-Class vessels at 98% (92%) and larger E-Class units at 72% (65%). Smaller K-Class vessels remained flat at 86%. Meanwhile the outlook for 2022 is positive. Secured utilisation currently stands at 88%, compared with 81% in 2021, and average secured day rates are running 12% ahead of 2021 actual levels, the company said. 

The company’s 13-strong fleet, operated from offices in the UAE, Saudi Arabia and Qatar, is amongst the youngest in the sector, with an average age of 11 years. The vessels are capable of operating in water depths of 45-80 m, depending on leg length. Their four-legged, self-propelled design means they do not require tugs or other support vessels for moves between location, thereby raising uptime and reducing overheads.  

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