Gulf Marine Services has warned 2016 will be another difficult year as the company expects earnings to fall and debt to rise as it copes with the oil and gas downturn.
Gulf Marine Services said its pretax profit was slightly lower in 2015 at $77.1 million from the $80.4 million made the year before despite the company’s revenue rising to $219.7million from $196.6million.
A large rise in finance expenses to $34.1 million from $21.4 million in 2014 hit the bottom line, with further increases expected in 2016.
Increased revenue led gross profit to rise to $132.2 million from $126.5 million in 2014.
Total dividend for 2015 was 1.61 pence.
Gulf Marine warned that net debt is expected to continue to rise this year, whilst earnings will be considerably lower as its margins will be squeezed by the depressed oil and gas market.
Abu-Dahbi based Gulf Marine provides jack-up vessels to the offshore oil, gas and renewable energy sectors.
“In recent conversations with clients it is clear that they continue to seek incremental cost savings both through the efficiencies that we can deliver through better working practices and innovative offerings, through lower charter rates, and in one instance, through the early termination of an existing vessel contract.
“In these demanding conditions, our focus is to maximise vessel utilisation and as a result we expect pressure on margins in 2016,” the company said in a statement.
Net debt rose to $398.9million at the end of 2015 from the $273.6million at the end of 2014, and the company warned that net debt will reach its peak this year at around $435million.
The company aims to end 2016 with net debt of around $425million, and expects this to gradually fall from 2017 onwards.
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