FPSO Player SBM Offshore Upgrades Annual Forecast after Upbeat Q3 results

Credit: SBM Offshore

SBM Offshore revised upwards its full-year revenue and core profit forecast on Thursday after the Dutch oil and gas services firm pointed to "solid" quarterly results.

The company now expects an annual revenue of more than $3.2 billion, bringing earnings before interest, taxes, depreciation and amortisation (EBITDA) for the year to around $1 billion. It had previously forecast revenue of about $3.2 billion and EBITDA exceeding $950 million. 

"We have delivered solid results this quarter, driven by the reliable and sustainable financial performance of our fleet and the resilience of our turnkey division which, despite a number of continuing challenges, is expected to deliver robust margins at portfolio level this year," Chief Executive Officer Bruno Chabas said in an earnings statement. 

SBM's underlying revenue increased 46% to reach $2.52 billion for the nine months ended Sept. 30. As a result, the group said it expected its lease and operate segment to generate over $1.7 billion in revenue this year and maintained outlook for its turnkey business, sensitive to cuts in capital expenditure by energy companies, at above $1.5 billion. 

What Moscow calls a "special military operation" in Ukraine has thrown the spotlight on Europe's reliance on Russian oil and gas, leaving the bloc scrambling to find alternative energy sources and expanding liquefied natural gas capacity. 

The Organization of the Petroleum Exporting Countries and allies, which has come under growing pressure to pump more crude oil following Western sanctions on Russia, decided last month to cut its production target even though U.S. officials had lobbied for weeks against such a move. 

"Construction activities continued to experience impact from the combined effects of the COVID-19 pandemic and the indirect impact from the war between Russia and Ukraine. 

The impacts vary from project to project reflecting global logistic issues as well as ongoing quarantine measures on personnel and material especially in China," SBM said. 

(Reuters - Reporting by Juliette Portala ; Editing by Jacqueline Wong and Sherry Jacob-Phillips)