Otto Sees Successive Full Year Loss amid Contract Cancellations
Otto Marine – an offshore marine group specializing in the building of offshore support vessels, ship chartering and offshore services operation – posted Friday a full year loss, ended Dec. 31, 2012, of $73.7 million, citing termination of three contracts and fewer number of vessels deployed by its geophysical segment as factors responsible for the company's dismal results.
Throughout 2012, Otto was grappling with a drop of orders in its shipyard and lower utilization rate of its seismic vessel. The company was also plagued by rising administrative and selling expenses.
Otto also suffered a net full year loss of $52.2 million in 2011.
Otto noted that the rest of this year will remain difficult for the company.
"Global economic conditions as well as the general environment of the shipbuilding industry remain challenging. Additionally, the shipyard is under-utilized due to lower order intake," Otto said in its earnings statement Friday.
Otto also revealed Friday that its subsidiary, Reflect Geophysical, applied for an order Thursday with the Singapore High Court for it to be placed under judicial management as creditors seek money. Reflect is unsuccessful in obtaining the order for a short to medium term standstill of claims from its creditors, and the company is at present seeking legal advice for its next course of action.
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