Keppel sees 'challenging environment' for offshore and marine

Keppel Offshore & Marine (Keppel O&M) reported revenues of SGD8.56bn up 20% on the previous year which the group attributed mainly to progress on ongoing jobs.

However, the outlook is less rosy. “The fall in oil prices, the expected reduction in global oil and gas upstream spending and the projected oversupply of oil rigs has created a challenging environment,” Keppel said.

The company is looking to its orderbook to provide a buffer through tough times having secured SGD5.5bn in orders last year, bringing its orderbook to SGD12.5bn with deliveries through to 2019. “The healthy order book will keep the yards busy for 2015 and 2016,” it said.

In a more positive long term outlook Keppel said: “The consumption of energy is projected to grow and is expected to sustain the oil and gas business. The division (Keppel O&M) will continue to leverage technology and innovation to improve its competitive edge as well as productivity and efficiency. It will focus on expanding its near market, near customer strategy.”

Keppel had created much speculation in the market this week when on Wednesday it postponed both its planned Keppel Corp full year media and analyst briefing scheduled for Thursday and another for listed property arm Keppel Land. Both stocks are also suspended for trading and the briefings have now been rescheduled for Friday afternoon.