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Seatrium reveals net order book of over $20 bil in 1QFY2023 business update

Felicia Tan
Felicia Tan • 3 min read
Seatrium reveals net order book of over $20 bil in 1QFY2023 business update
Artist’s impression of the offshore substation platform solution for the Empire Wind offshore wind project. Photo: Equinor
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Seatrium (formerly known as Sembcorp Marine or SembMarine), has revealed that it has a net order book of over $20 billion with a total original contract sum of $27.8 billion in its business update for the 1QFY2023 ended March 31.

Of the total net order book, around $19.9 billion of products are under execution with ongoing repairs and upgrades projects making up the balance. Renewables and cleaner/green solutions comprise about 39% of the total net order book.

“The group continued to execute strongly into the first quarter of FY2023 and to date, has successfully delivered multiple key projects including notable repair and major refits projects,” says Seatrium in its business update.

Some of these projects include a zero-emission full battery-operated roll-on/roll-off passenger ferry, as well as the Prosperity FPSO or floating, production, storage and offloading vessel for SBM Offshore.

Key projects under execution with delivery scheduled from 2023 to 2030 include RWE Renewables’ Sofia Offshore Wind Farm, Newbuild Wind Turbine Installation Vessels (WTIV) Charybdis for Dominion Energy and Sturgeon for Maersk Supply Service (Maersk).

The group also has multiple EPC (engineering, procurement and construction) contracts from Brazilian state-owned oil and gas producer, Petroleo Brasileiro S.A. (Petrobras), for newbuild FPSOs, as well as 20 liquefied natural gas (LNG) carriers across its yards across its yards undergoing retrofitting programmes.

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For the 1QFY2023 to-date, the group has serviced a total of 91 vessels and offshore structures at its yards.

During the quarter, the group reported a number of key contract wins including the landmark framework cooperation agreement (FCA) from TenneT, two offshore substation platform projects from Empire Offshore Wind and an offshore substation platform construction contract from an international renewable energy company.

Year-to-date, the group has registered a higher overall cash balance following the merger with Keppel Offshore and Marine (Keppel O&M) and an improvement in operating cash flows from continuing successive completion and deliveries of key projects.

See also: Delfi's lower earnings of US$23.3 mil for 1QFY2024 due to consolidated net sales

These will be used to meet payables and other working capital needs in FY2023, it says.

As at end-March 31, Seatrium has a net debt/equity ratio of 0.18 times, compared to 0.26 times as at end-December 2022.

There has been no further disbursement of the proceeds from the September 2021 $1.5 billion rights issue with the balance of the net proceeds remaining at around $600 million since end-December 2022.

“The group expects to have the necessary liquidity to fund its operations for the foreseeable future,” says Seatrium.

In its outlook statement, the group says it expects the industry outlook for oil & gas, offshore renewables and other green solutions continues to improve and strengthen.

The completion of the rest of its projects will contribute positively to the group’s financial performance.

Shares in Seatrium closed 0.4 cents lower or 3.08% down at 12.6 cents on May 11.

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