Jakarta, 29 July 2016
PT Logindo Samudramakmur Tbk. (“Company”), a company engaged in the offshore support services for the oil and gas industry, today announces its unaudited financial statement for the first six months of 2016.
President Director, Eddy Kurniawan Logam, expressed: “Our first half performance was still challenging but disappointing from all aspects. Although global oil price has somewhat increased since February 2016, today it is still showing signs of instability. As such, investment in the Oil & Gas E&P has not been revived yet. For our business, we have faced more record-level low charter rates from fierce competition on recent project tenders. In addition, we have also encountered rate re-negotiation pressure from some of our customers.
Chief Financial Officer, Sundap Carulli, explained: “The lower overall vessel utilization and continuing depressed charter rates during the first half of 2016 caused the decrease in the Company’s revenue by 31% over the same period last year. We have managed to reduce vessel operating costs and overhead expenses, particularly for crew salaries (27% lower), vessel repair and maintenance (37% lower) and staff salaries (28% lower). Financing charges for the period was also 9% lower.
Management has performed internal assessment of the business against the Company’s operating assets. To reflect prudence management, the Company has provided impairment provision on its vessel fleet to the amount of US$10.9 million. The net loss for the year was unprecedented but reflect the uncertainty in the industry and market.”
Eddy added: “ Going forward, we will be more aggressive to compete on rates to increase vessel utilization. We are tracking better prospect of future projects in the second half of 2016 and we’ll target to win some of these tenders. Maintaining prudent cash flow will remain critical in the next months. We are continuing to review our operating efficiency, control cost and expenditure expediently. In addition, we will push to sell our idle, ageing vessels and obtain some cash for the Company.
The progress of our bank term loan refinancing has borne some fruits. With extended tenure on same terms, this will lower our monthly financing payment by at least 60% starting in August 2016. We are hopeful that the Company will deliver a better second half performance.”