ASRY Set to Ride Out Economic Storm

Tuesday, April 14, 2009

Bahrain-based Arab Shipbuilding and Repair Yard Co (ASRY) is set to ride out the global economic storm in 2009 following its record breaking year in 2008. Both chairman, H.E. Shaikh Daij bin Salman bin Daij Al-Khalifa and Chief Executive Chris Potter are upbeat about the yard’s performance this year following sales in 2008 breaking the $200m barrier for the first time.

“ASRY is now debt free for the first time in its history,” said Shaikh Daij, “and we have a strong cash flow.”

“In the past year or so we’ve put new policies in place and these have paid off. The shipyard is now competitively priced, offers a quality service and we are now getting much closer to our customers.”

In 2008 the Bahrain shipyard had sales of $207.5m, the best year in its history, and repaired a total of 133 vessels and offshore craft; 119 in drydock and 14 alongside. ASRY’s customer base is traditionally split between vessels owned by Arab operators and the international shipping market. Last year saw 72 vessels repaired from the international market, valued at $112.3m, and 61 vessels from the Arab market, valued at $95.2m. A total of 20 vessels came from the Saudi Arabia market, 17 from Bahrain and 13 from Kuwait, with the latter bringing in the most in terms of revenue. KOTC is the yard’s No.1 customer and repairs to the company’s VLCC Al Samidoon was one of the largest single repair jobs carried out by ASRY in 2008.

Leading the way in the international market was Greece with 19 vessels, Norway with 17 ships, the USA with 10 vessels and Brazil with nine ships. The business from Brazil, however, was the most profitable. Up until mid-March this year the yard had repaired a total of 42 vessels, 24 from the international market and 18 from the Arab market.

Chris Potter, ASRY’s chief executive noted that the start to 2009 was not bad, but that February was a tough month. “We are receiving a high level of enquiries, but the actual value of individual contracts is down on last year,” said Potter. The average vessel repair contract in 2008 was $1.56m. In looking at 2009, Potter said that he “would be happy if the yard could achieve the same level of sales as in 2007 ($170m), but it was too early to make a call on that at present.”

Among the repair highlights for 2008 were:
•    Work on the offshore pipelaying barge PMS 12, owned by Egypt’s Petroleum Marine Services
•    Repairs to the KOTC-owned 284,889dwt tanker Al Samidoon
•    Drydocking and repairs to the offshore diving support ship Samudra Sevak, owned by the Shipping Corporation of India
•    Repairs to the offshore barge HLS 2000, owned by Abu Dhabi’s National Petroleum Construction Co
•    Drydocking and repairs to the Saudi Arabian owned 42,600dwt ro-ro/containership Saudi Hofuf 

2008 was also a significant year for ASRY for a number of other reasons. The beging of the year saw a new company, ASRY Offshore Services (AOS), start operations in earnest, while the middle of the year saw the entering into service of the yard’s two new large slipways, at a cost of $20m.  At the same time, the ASRY Board of Directors gave the green light for a further $188.2m facilities expansion plan.

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