GMS sees improvement in performance despite COVID-19

London-listed Gulf Marine Services (GMS) said it has seen significant improvement in performance despite the difficulties brought by COVID-19.

GMS said that adjusted EBITDA increased by 34 per cent to US$31.4 million compared to $23.4 million in the first half of 2019. GMS said that this reflects the benefit of cost savings and improved utilisation, despite the impact of COVID-19 on the market environment and operations.

In a statement, GMS said that progress continues on the programme to reduce costs. The 2019/20 cost saving programme has secured $16.5 million in savings, on an annualised basis, significantly exceeding the original target of $6 million set in March 2019. The company added that as a result of the Framework Agreement with Zakher Marine International announced on 29 May 2020, further savings are expected to be delivered going forward.

Revenue was reduced by 9 per cent to $49.8 million compared to $55 million in the same period last year. Reflecting lower day rates for all vessel classes, partially offset by an improvement in utilisation.

GMS highlighted that the average fleet utilisation for H1 2020 had increased to 78 per cent, a 9 percentage point increase, despite the impact of COVID-19 on tender activity and operations.

Tim Summers, executive chairman, GMS said: "GMS has delivered a significant improvement in performance despite the difficulties brought by COVID-19, and the resultant oil price collapse. Vessel utilisation has been restored to 2016 levels, while adjusted EBITDA is up 34 per cent on H1 2019. We have continued to secure new contracts throughout the pandemic, increasing the order book and profitability is up substantially compared to the previous year."

He added: "In fewer than twelve months, a new management team has fundamentally repositioned GMS for success. With 83 per cent fleet utilisation already secured for 2020, and a lean cost base, we are already demonstrating the business's ability to drive profitable growth."