Bourbon Feels the Pain of Low Oil

The impact of the oil market cycle reaching its bottom was felt in Bourbon in the first half of 2016, as the company announced first half 2016 adjusted revenues of €599.2 million, a 21 percent decline year on year and 11.7 percent reduction compared to 2H 2015.

Bourbon believed that its large market share and young fleet were keys to keeping it stronger while others failed, but it appears that the market has caught up to the company too.

An evaluation of performances by shows:

-- The bottom of the market in the Subsea segment was reached in Q1 2016, and it is anticipated that the improvement in utilization rates in the second quarter will continue in the quarters to come

-- The bottom of the market has been in Q2 2016 for the Crew boat segment; reduced helicopter activity for cost savings purposes and the increase of activity in production of existing fields are expected to improve the use of crew boats going forward

-- In the segments Deep and Shallow water, Bourbon anticipates the bottom of the market in Q3 2016, due to the late cyclical nature of this business.

“More than ever, Bourbon is focusing on what the teams control: safety, reliability, cost control and improved efficiency to the customers benefit,” said Jacques de Chateauvieux, Chairman and CEO of Bourbon Corporation. “While the world’s largest oil field services company thinks the crude oil market has bottomed, Bourbon is ready to benefit in the first place from the market recovery when it will materialize”.
 

Bourbon anticipates the low point of adjusted revenues in Q3 2016, with a possible improvement at the end of 2016.
 

Bourbon has continued its cash preservation strategy with proactive stacking of vessels whenever appropriate. At the end of June 2016, 67 supply vessels were stacked, representing 27 percent of the supply fleet.