A Review of the Nigerian Energy Industry

Subsea 7 sees profits slip

Subsea-718 November 2013 –Engineering and construction player Subsea 7 saw profits slip as revenues fell during the third quarter of the year.

The company posted a profit of $160 million for the third quarter of the year, down from a profit of $194 million during the same quarter last year.

The fall in profits came as revenue slid from more than $1.7 billion a year a go to just under $1.6 billion in the recent quarter.

A rise in revenue from the Africa, Gulf of Mexico and Mediterranean territory as well as the Asia Pacific and Middle East territory was more than offset by a decline in the Brazil as well as North Sea and Canada territories.

Revenue from Brazil during the quarter dropped $105 million year-on-year, to $233 million, which Subsea 7 attributed to lower levels of procurement and the dry docking of the Kommandor 3000 and Seven Condor vessels during the recent quarter.

Revenue from the North Sea and Canada territory fell from $847 million to $670 million partly due to the cancellation of the Fram project in the first quarter of the year and the transfer of the Seven Oceans vessel to Brazil.

Alos contributing to the fall in profit during the third quarter were foreign exchange losses totalling $38 million, mainly driven by the weakening of the US dollar, while the 2012 third quarter also benefited from a $23 million gain on the sale of NKT Flexibles.

As of 30 September Subsea 7’s backlog stood at a record $11.8 billion, with a further $1.1 billion in contracts being awarded to the company since the end of the third quarter.
*Josh Lewis, Upstream

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