Utilisation hits Otto

Otto Marine saw its results plunge into the red in the first quarter as declining utilisation sapped away revenue.

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The Singapore-listed offshore vessel and shipyard owner reported a quarterly loss of $14.9m, turning around a $1.3m profit in the same period of 2013. But the negative numbers should not come as a surprise to investors, since Otto warned the market of the looming loss earlier this week.

The company’s revenue plunged by 42.6% to nearly $77.2m while cost of sales dropped by 37.5% to more than $75.3m.

Shipping revenue plunged by $24.7m was a result of the utilisation impact of five-year dry dockings required for several ships. Vessel repositioning also cut into the revenue total.

The shipyard segment also took a hit, but that was mainly because of a lucrative vessel sale in the first quarter of 2013 that made the comparables hard to beat.

The company’s Houston-based subsea services division saw its revenue grow by $2.2m thanks to a charter contract, although its gross profit dipped by roughly $100,000.

Otto, which is also headquartered in Singapore, logged a gross profit of $1.84m, an 86.7% drop from $13.9m in the first quarter of 2013.

The company finished the quarter with $1.28bn in assets including $79.6m in cash, and it had $991m in liabilities including $328m of bank debt.