The Aberdeen-based offshore services group SeaEnergy said low oil prices had hit the business, reducing turnover and profitability in the first half of the year and affecting expectations for the full year.
This has led to a half year pre-tax operating loss of £881,000, compared with a £22,000 loss for the same period last year.
Announcing its half-year results SeaEnergy recorded revenues of £1.8 million compared to £2.5 million in 2014.
Following its decision, announced early this year, to exit ship management the company will focus on the more profitable R2S Visual Asset Management, which it sees has the greatest potential for growth.
SeaEnergy said: “The oil services sector is enduring a major slowdown in activity, as operators retrench in response to sustained lower oil prices.
“The company’s core activity – the provision of R2S VAM software and services – has been affected by cost cutbacks and work deferrals, although there are emerging signs of recovery.”
SeaEnergy said the savings will become more evident in the second half of the year and further cost reductions are planned for 2016 as the group structure is simplified for a more focused business following the exit from ship management and the planned relinquishment of part of the lease on the head office.
Central cost savings have been achieved by a reduction in the number of executive directors and all of the main board waiving part of their remuneration. It has also cancelled some third party contracts.
“The company will be leaner and more tightly focussed on R2S going into 2016,” it added.
Chairman David Sigsworth, said: “The business has been impacted by the decline in oil price and deferrals and reductions in operators’ budgets. However, the steps it was already taking, to focus on R2S VAM, to reduce central costs and to internationalise and diversify, are positioning us well to benefit from the recovery expected in 2016 when we anticipate a return to profitability.”
