Bourbon Reports 3Q 2013 Revenues

MarineLink.com November 6, 2013

Bourbon released its results for the third quarter 2013 and reported signs of continued improvement in offshore vessel demand. Revenues were up 8.6% compared to third quarter 2012, and up 12.2% against first nine months 2012 partly as a result of contract renewals at improved rates.

Highlights from the report:

Revenue increased 8.6% versus third quarter 2012 benefiting from fleet increases and steady utilization rates
Average utilization rates for the supply fleet remain high versus the same period last year with offsetting impacts of several vessels in transit and stronger demand in several markets
Average daily rates for the supply fleet were +3.7% versus the same period last year partly due to renewal of contracts at higher levels
West Africa demand improving sequentially over second quarter 2013

“Increases in the Bourbon fleet and improvements in demand have partly contributed to growth in revenues for both the quarter and year to date period,” said Christian Lefèvre, Chief Executive Officer of Bourbon. “During the third quarter 2013, vessels in transit between Regions compared to 2012 in Deepwater and Shallow water offshore vessel segments contributed to declines in average utilization rates. Foreign exchange rates in the third quarter 2013 had a negative impact on Bourbon’s revenues of approximately €11 million compared with the second quarter of 2013."

He continued, "Bourbon will continue to implement the reduction of its debt as per the Asset Smart portion of the “Transforming for Beyond” action plan with the sale of the next 15 vessels during the coming weeks and the remaining 27 vessels in batches as they are delivered and before the end of June 2014, for a total of $1.5 billion, including the nine vessels sold in early September.”

Operatoinal Highlights Marine Service

In line with clients’ investment strategy, demand for supply vessels continues to improve, enabling high utilization rates and favorable average daily rate momentum by region, by vessel type

Deepwater offshore

The deepwater market benefited from steadily improving demand with a large number of new drilling rigs commencing operation, especially in West Africa
Average daily rates maintained their growth momentum of the last quarters, especially driven by good summer activity in the North Sea and the impact of renewal of older contracts in West Africa
Bourbon’s deepwater fleet was stable overall with two more vessels operational for the period compared with 2012 due to timing of vessel deliveries and vessel sales
Two Brazilian AHTS terminated their eight-year contracts and were idle during the quarter, and two large PSVs moved from the North Sea to West Africa

Shallow water offshore

There has been high growth in Asia mainly due to increased shallow water drilling activity and growth in Mediterranean/Middle East/India due to the strength of the replacement market in the Persian Gulf area
Deliveries of vessels to the shallow water market fuelled a steady increase of revenues in that segment during the first nine months of 2013 compared to the corresponding period in 2012, with eight vessels delivered in the third quarter 2013 alone

Crewboats

Spot activity in West Africa has been affected by the rainy season in the third quarter, when activity typically is reduced
During 2013, customers in Asia increasingly required Bourbon’s services for safe and reliable operation
The stability of the fleet of Bourbon crewboats during the last several quarters is a combination of the disposal of older vessels and an increase of the number of large FSIV. This translates positively in the comparison of average daily rates

Subsea Services

Bourbon Subsea Services operations are maturing in a favorable market:
Vessel availability is the result of a reduction of unplanned maintenance and classification dry-docks compared with last year, driving utilization rates higher
Contracts have been renewed at better terms
With three Bourbon Evolution 800 vessels in operation, the suitability and interest in vessel specifications is building up, contributing positively to the average daily rate of the fleet and average utilization rate
Subsea Services performance indicators of the first nine months show steady growth and operational excellence, with Q3 2013 illustrating a high point in this respect