Alam Maritim hopes to return to profitability this year

The group had secure short- and long-term OSV contracts worth RM226.08 million, comprising RM180 million from local O&G players, RM36 million from the Middle East, and the balance from local main contractors.

BUKIT JALIL: Offshore support vessels (OSV) and sub-sea services provider Alam Maritim Resources Bhd hopes to return to the black in the current financial year ending Dec 31, 2018 on the back of newly-secured oil and gas (O&G) related contracts.

Group Chief Executive Officer Datuk Azmi Ahmad said the group was short of long-term contracts in 2017 compared with this year, during which it managed to secure several long-term contracts to help lift the vessel utilisation rate.

“We hope the new contracts will enable the company to return to the black.

“Fully recovering to the black is quite a challenge, (but) if we can actually reduce the amount of losses we record (this year) compared to 2017, I think we should be able to have better results in 2019,” he told a press conference after the group’s annual general meeting yesterday.

The group’s order book currently stands at RM333 million, surpassing the RM197.75 million secured in 2017.

Azmi said the bulk of the contracts secured this year were for two to three years, with the option for renewal extension of up to three years.

Yesterday, the group announced it had secure short- and long-term OSV contracts worth RM226.08 million, comprising RM180 million from local O&G players, RM36 million from the Middle East, and the balance from local main contractors.

He said these contracts, of which delivery will start in August, would impact the group’s financials starting in September while the full impact would be seen in 2019.

At present, Azmi said the group has actively placed bids for several OSV, offshore installation and construction (OIC), and inspection repair maintenance of underwater facilities (IRM) contracts worth RM1.2 billion, with a success rate of between 10 per cent and 15 per cent.

He said the group was expected to announce the outcome of the IRM contract bids involving three packages by the third quarter of this year.

“If we secure this contract, the full impact (on revenue) would be in the fourth quarter,” he added.

Azmi said Alam Maritim planned to reduce its fleet size by half from the current 42 vessels and barges as part of the group’s cost optimisation and asset rationalisation, targeting to dispose of assets aged 15 and above.

For this year alone, he said the group had so far managed to dispose of at least three of its dump barges and targeted to reduce the entire fleet size further to between 35 and 38 units by year-end.

On debt restructuring, he said the group is currently at the tail-end of the exercise and would be able to sign bilateral agreements with its creditors in the fourth quarter of this year.

“The (debt) scheme provides us with (breathing) space for two years…so by 2020, we should be able (to) finish it off,” he said, adding the group’s outstanding debt now stands at RM600 million. — Bernama

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