Scomi Marine aims to sell more old vessels

Scomi Marine Bhd aims to sell at least 10 of its offshore utility vessels that are over 20 years old in the next two to three years.

Chairman Tan Sri Nik Mohamed Nik Yaacob said the company had in the last year sold four vessels that were over 20 years old for US$3.2mil.

“We are looking to sell off these old vessels progressively,” he told a press conference after the company’s AGM yesterday.

Scomi Marine via its 29.07% Singapore-based associate, CH Offshore Ltd, is currently in negotiation for the acquisition of two anchor-handling tug and supply (AHTS) vessels, to be delivered separately this year and next.

With a cash balance of about RM150mil, the company is in a strong position to take advantage of the lower vessel prices amid the economic slowdown.

As of last year, the company’s gearing was below 0.6 times thanks to the consolidation that took place last year.

“We are also expecting to close some deals to charter out our new accommodation barge within this month,” said president Mukhnizam Mahmud, without disclosing the targeted chartered rates for the barge.

Due to be delivered this week, the accommodation barge has the capacity to shelter 180 people for its offshore support services.

Mukhnizam said there would still be demand for vessels, mainly in the Asian region, as national oil corporations and international companies have their own agenda to meet.

“We need to appreciate the macro level where major oil companies would still need to produce oil. We just need to be mindful of the services we offer,” he said.

On its marine logistics for the coal industry, Mukhnizam said demand for coal should pick up, especially in the emerging markets, as it is a viable alternative for power producers who need to diversify their generating base.

Scomi Marine has transported about 900,000 tonnes of coal to power utility companies in the last year and expects to carry in excess of one million tonnes in 2009.

Scomi Marine, a 43% associate company of Scomi Group Bhd, is optimistic that demand for marine logistics and offshore support services will continue to be resilient amid the current economic slowdown.

Scomi Marine’s net profit rose 19.6% to RM64.9mil for financial year ended Dec 31, 08 while revenue increased to RM467.1mil from RM462.1mil.

The higher net profit was mainly due to savings in general and administrative expenses and a higher contribution from an associate company following the deliveries of four new AHTS in the first quarter of last year.

Source: StarBiz