Wintermar Offshore (WINS:JK) Unveils Growth Strategy

Wintermar Offshore Marine (WINS:JK) has invested US$12 million to acquire 3 Platform Supply Vessels and 3 Anchor Handling Tug Supply Vessels since November 2021, to gear up for new drilling cycle.

In the Public Expose on 24 June 2022, PT Wintermar Offshore Marine Tbk unveiled their growth strategy to position the Company for an anticipated upturn in drilling. As the global rig count has risen steadily over the past few months, Offshore Supply Vessel (OSV) utilization has improved globally and charter rates have started to pick up.

To raise the yield of the fleet, the Company has improved the fleet composition through the sale and reinvestment of certain vessels. 95% of the fleet is now concentrated into higher value vessels. Wintermar now has seven Platform Supply Vessels, three of which are undergoing docking for reactivation and should be ready for operations by 2H2022. This is timed in anticipation of a stronger 2023 as there has been an increase in project approvals for offshore drilling and corresponding rise in demand for OSVs.

Finance Director Janto Lili reported that the Company has succeeded in controlling costs while continuing to repay debt. The Company turned around in 2021 with a net profit after tax of US$0.2 million following several years of net losses. Net gearing was reduced to 14.7% by end of March 2022.

Managing Director, Sugiman Layanto reiterated an optimistic view for the coming years, with OSV charter rates projected to rise. This is due to the demand for OSVs rising in line with the jump in offshore drilling projects, while the supply of operationally ready OSVs is still limited due to the industry downturn over the past years.

In the longer term investments in renewable energy are expected to grow while investments in oil and gas are still projected to be stable to meet the energy needs of the world. As an OSV operator, Wintermar will benefit from higher demand for vessels initially from oil and gas industry but in the coming years additional upside in demand is expected from the offshore wind industry.

For the future, Wintermar will focus on higher value vessels to improve fleet yields and continue to improve cost efficiency.

As at end of May 2022, the Company’s Contracts on hand amounted to US$64 million.

About Wintermar Offshore Marine Group

Wintermar Offshore Marine Group (WINS.JK), developed over nearly 50 years with a track record of quality that is both a source of pride and responsibility that we are dedicated to upholding, and sails a fleet of more than 48 Offshore Support Vessels ready for long term as well as spot charters. All vessels are operated by experienced Indonesian crew, tracked by satellite systems and monitored in real-time by shore-based Vessel Teams.

Wintermar is the first shipping company in Indonesia to be certified with an Integrated Management System by Lloyd’s Register Quality Assurance, and is currently certified with ISO 9001:2015 (Quality), ISO14001:2015 (Environment) and OHSAS 18001:2007 (Occupational Health and Safety). For more information, please visit www.wintermar.com.

For further information, please contact:
Ms. Pek Swan Layanto, CFA
Investor Relations
PT Wintermar Offshore Marine Tbk
Tel: (62-21) 530 5201 Ext 401
Email: investor_relations@wintermar.com






Topic: Press release summary

Offshore Wind Energy in India


Shri R.K Singh, Union Minister for Power and New & Renewable Energy held a meeting today on transmission planning for offshore wind energy projects in India. Shri Alok Kumar, Secretary, Power and Shri Indu Shekhar Chaturvedi, Secretary, Ministry of New & Renewable Energy were present in the meeting.


During the meeting, transmission and evacuation infrastructure required for offshore wind projects of total capacity 10 GW off the coasts of Gujarat and Tamil Nadu, was discussed. A presentation on this was made to the Minister by the Central Transmission Utility (CTU).


After a detailed review, it was decided to bid out offshore wind energy blocks as per the following trajectory:


  • Bids equivalent to a project capacity of 4.0 GW per year for a period of three years starting with the current FY 22-23 for development off the coast of Tamil Nadu and Gujarat for sale of power through open access / captive / bi-lateral third party sale / merchant sale
  • Subsequently a project capacity of 5 GW will be bid out every year for a period of five years i.e. up till FY 29-30.


The project capacity of 8 GW bid out in the first two years beginning FY 22-23 will also be able to avail of the benefits of green attributes like carbon credits.


The bidding for the first 12 GW will be conducted on a single stage two envelope model wherein the bidders will be evaluated based on their techno-commercial capabilities and only the technically qualified bidders will proceed to financial evaluation. The financial evaluation will be based on quoted lease fee per sq km of sea bed area. The bidder offering the highest lease fee per sq km of sea bed area would be declared as the winner for allocation of the project.


Evacuation and transmission of power from offshore pooling Substation (PSS) to onshore transmission will be provided free of cost for all offshore wind capacities that will be bid out up to FY 29-30.


The Ministry of New & Renewable Energy through its implementing agency will issue the first bid in the next three – four months for leasing out offshore wind energy blocks equivalent to 4.0 GW capacity off the coast of Tamil Nadu.


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NG




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Wintermar Offshore Marine Reports 1Q2022 Results; Total revenue up 3%

Wintermar Offshore Marine (WINS:JK) has announced results for 1Q2022. Total revenue was up 3% YOY to US$10.5 million, with stronger chartering revenues compensating for a drop in Owned Vessel revenue from COVID-19 delays.

Oil prices spiked in 1Q2022 as a result of the war in Ukraine and sanctions against Russian oil and gas. The ensuing oil shortage sparked a rise in investment in oil exploration and a resurgence in drilling programs in Asia.

The Company was impacted quite severely by a spike in Omicron infections on the fleet, which led to prolonged delays in the commencement of operations in international as well as domestic charters in 1Q2022. Owned Vessel revenues declined but this was compensated by a jump in revenues from the Chartering and Other Services Divisions.

Owned Vessel Division

Several vessels were infected with COVID-19 in 1Q2022 and had to be quarantined. Emergency crew changes were arranged, but revenues were penalized due to the resulting delays while higher costs were incurred as vessels had been fully crewed in anticipation of on-hire. Crew salary was flat YOY at US$2.1million, operations and maintenance costs rising by 40%YOY and 23%YOY respectively in preparation for new contracts. Fuel was significantly higher at US$0.67 million due to the one-off cost of international mobilization and demobilization of vessels due to different locations for on- and off-hire. This led to a 21% YOY decline in Owned Vessel revenue to US$6.6 million, while direct costs rose by 10% YOY.

During the quarter, the Company purchased an additional 4 vessels, comprising one PSV, 2 units of 5,000 BHP AHTS and 1 unit of 6,000 BHP AHTS. Two of these vessels are being modified for reactivation while the other two are finishing off existing contracts and providing some charter income. As 4 of the 6 vessels acquired since 4Q2021 were undergoing docking and reactivation in 1Q2022, there are no revenues arising whereas costs have started to incur. All these reasons led to a gross loss of US$0.58 million from the Owned Vessel Division.

Chartering and Other Services

Gross Profit from Chartering jumped by 260% YOY to US$0.37 million with the addition of three new contracts in Brunei, while Other Services Division saw a 49% increase in gross profit to US$0.38 million.

Total Gross Profit for 1Q2022 was US$0.18 million compared to US$2.1 million in 1Q2021.

Indirect Expenses and Operating Profit

The biggest contribution to a rise in Indirect Expenses was a rise in staff salaries which increased by 47% due to the annual discretionary bonuses paid out in March, and an increase in staffing. The Company also readjusted salaries in 2021 to reverse most of the salary reductions volunteered by employees when the COVID-19 started in 2020. With the increase in indirect expenses, the Company recorded an Operating Loss of US$1.18 million.

Other Income, Expenses and Net Attributable profit

Interest expenses fell by 51% YOY to US$0.36 million in line with much lower gearing while the stronger Rupiah also resulted in an FX loss of US$0.03 million. Loss in earnings of associate amounted to US$0.07 million after recording a small profit in 1Q2021 while there was a tax penalty of US$0.15 million in a subsidiary.

Net loss attributable to shareholders for 1Q2022 was US$1.8 million compared to a loss of US$0.34 million in 1Q2021. EBITDA for the quarter was US$1.7 million from US$4.3 million in 1Q2021.

Outlook for Oil and Gas exploration

After the sharp spike, releases of strategic oil reserves by the US and downward revisions to 2022 oil demand arising from COVID-19 lockdowns in China have taken some pressure off oil prices. With Brent crude oil prices settling around the US$100/barrel mark, and sanctions against Russian oil, there is still a huge incentive for oil exploration. In Asia, there is stronger demand for oil services as new drilling projects have been announced. In Indonesia, Pertamina has announced a plan to drill 29 exploration wells and 813 development wells in 2022 while private oil companies are also planning drilling campaigns.

In 2021, global offshore investment in EPC (Exploration, procurement and construction) grew by 200% YOY to US$42 billion and with the Ukraine invasion, 2022 is expected to see further growth. Below is a chart from Westwood Global Energy projecting sustained higher levels of global offshore investment.

Strategy and Outlook

The Company embarked on a capital expenditure plan in 4Q2021 and to date has acquired a total of 6 vessels ranging from 5000BHP AHTS to Platform Supply Vessels. After docking and reactivation, these vessels will be ready for operations in mid 2Q2022, in time for an anticipated pick up in demand as drilling campaigns start by mid 2022.

In Asia, there are projects starting in Thailand, Malaysia, Brunei and India which require higher value support vessels. Charter rates are still constrained in Indonesia due to low budgets set last year, but some projects which were delayed are now expected to commence operations in the coming months. We are optimistic that the long awaited recovery in drilling is underway.

Contracts on hand as at the end March 2022 totalled US$64 million.

About Wintermar Offshore Marine Group

Wintermar Offshore Marine Group (WINS.JK), developed over nearly 50 years with a track record of quality that is both a source of pride and responsibility that we are dedicated to upholding, and sails a fleet of more than 48 Offshore Support Vessels ready for long term as well as spot charters. All vessels are operated by experienced Indonesian crew, tracked by satellite systems and monitored in real-time by shore-based Vessel Teams.

Wintermar is the first shipping company in Indonesia to be certified with an Integrated Management System by Lloyd’s Register Quality Assurance, and is currently certified with ISO 9001:2015 (Quality), ISO14001:2015 (Environment) and OHSAS 18001:2007 (Occupational Health and Safety). For more information, please visit www.wintermar.com.

Ms. Pek Swan Layanto, CFA
Investor Relations
PT Wintermar Offshore Marine Tbk
T: (62-21) 530 5201 Ext 401
E: investor_relations@wintermar.com

DISCLAIMER
Certain statements made in this publication involve a number of risks and uncertainties that could cause actual results to differ materially from those projected. Certain statements relating to business and operations of PT Wintermar Offshore Marine Tbk and Subsidiaries (the Company) are based on management’s expectations, estimates and projections. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such statements. The information contained in this release is not intended to qualify, supplement or amend information disclosed under corporate and securities legislation of any jurisdiction applicable to the Company and should not be relied upon for the purpose of making investment decisions concerning any securities of the Company.






Topic: Press release summary

Wintermar Offshore (WINS:JK) Reports Turnaround 9M2021 Results

Wintermar Offshore Marine (WINS:JK) has announced turnaround results for 9M2021 with a net profit of US$0.49 million following a loss of US$7.44 mil in 9M2020.

Stronger oil prices and measures to streamline the fleet and reduce gearing helped in turning the Company around after several years of heavy losses. In line with the positive outlook for oil prices, utilization also improved to 66% in 9M2021 compared to 63% in 9M2020.

Owned Vessel Division

Owned Vessel Revenue for 9M2021 was reduced by US$0.2 million to US$24.4 million compared to 9M2020. During July and August, the delta variant of COVID-19 hit Indonesia hard and affected our operations in Asia. A few of our vessels were infected while crew change was delayed due to quarantine and travel restrictions, leading to unplanned downtime. This and the completion of some high end vessel contracts led to a lower margin for 3Q2021. However, since September the pandemic has waned significantly in Indonesia and business operations have recovered back to normal.

Despite the disruption from COVID-19, due to a much lower cost base and a smaller fleet, the Company made a US$4.1 mil gross profit this year for 9M2021 compared to a loss of US$2 million in 9M2020 on nearly the same revenue. Fuel costs rose to 37% as some high tier vessels were idle between contracts.

Chartering and Other Services

Contribution from the Chartering Division in 9M2021 jumped by 64% YoY from US$0.4 million to US$0.66 mil while contribution from other services also jumped 85% YOY to US$0.62 million in 9M2021 from US$0.34 million in 9M2020. These reflect the underlying improvements in offshore vessel demand.

Indirect Expenses and Operating Profit

Indirect expenses totaled US$3.92 million in 9M2021, falling 13% YOY from US$4.5 million, reflecting a much leaner organizational structure with lower overheads as compared to 2020. This has resulted from the fleet efficiency exercise over the past couple of years to sell less efficient vessels and reduce overheads. 9M2021 operating profit amounted to US$0.15 million.

Other Income, Expenses and Net Attributable profit

Since January 2021, the Company has sold 3 vessels and has already entered into a MOA to sell another three, registering in a US$2.4 million gain on sale of vessels. The total fleet now stands at 40 vessels. A total of US$9.5 million in vessel loans was repaid, bringing the Company’s net gearing down to 21.7% by end September 2021. Interest expenses for 9M2021 fell by 33% YOY to U$1.66 million in line with lower debt. Associated Companies generated income of US$0.24 million due to better operational results, bringing the other income to US$0.79 million for 9M2021 compared to a loss in 9M2020.

The stronger operational environment has boosted the bottom line, with net income attributable to shareholders of US$0.49 million for 9M2021, as compared to a US$7.44 million loss.

EBITDA for 9M2021 also rose by 13% YOY to US$10.2 million.

Oil & Gas Industry

As expected, the opening up of travel restrictions across the world has led to a spike in oil prices as supply has not been able to keep pace with growing demand for oil and gas. Global oil demand is expected to recover to pre-virus levels in 2H2022 and the 3rd quarter saw Brent crude oil prices breaking above US$85/barrel, levels not seen since 2014. This reflects the optimism in the oil and gas industry which has finally shown a cyclical recovery. In Indonesia, there are tenders for drilling projects due to start in early 2022.

Offshore Vessels

In line with the oil price spike, there has been an increase in purchases of second hand offshore vessels, and prices have turned around as vessels which had been on offer for a while were bought up. The international rig count has also picked up as more investments have commenced. This is in line with our optimistic outlook for the industry in 2022.

Strategy and Outlook

Over the past few months, the Company has stepped up the sale of older and less productive vessels to take advantage of the improvement in second hand OSV prices. The fleet now stands at 40 vessels, and more are planned to be sold in 4Q2021. This strategy to reduce bank debt as well as keep some cash on hand has created a stronger balance sheet. As banks are still reluctant to lend for vessel acquisition, the Company now has the flexibility to acquire assets as and when the opportunity arises without having to wait for bank loan approval.

Contracts on hand as at end September 2021 totalled US$64 million.

About Wintermar Offshore Marine Group

Wintermar Offshore Marine Group (WINS.JK), developed over nearly 50 years with a track record of quality that is both a source of pride and responsibility that we are dedicated to upholding, and sails a fleet of more than 48 Offshore Support Vessels ready for long term as well as spot charters. All vessels are operated by experienced Indonesian crew, tracked by satellite systems and monitored in real-time by shore-based Vessel Teams.

Wintermar is the first shipping company in Indonesia to be certified with an Integrated Management System by Lloyd’s Register Quality Assurance, and is currently certified with ISO 9001:2015 (Quality), ISO14001:2015 (Environment) and OHSAS 18001:2007 (Occupational Health and Safety). For more information, please visit www.wintermar.com.

Ms. Pek Swan Layanto, CFA
Investor Relations
PT Wintermar Offshore Marine Tbk
Tel +62-21 530 5201 Ext 401
Email: investor_relations@wintermar.com


Topic: Earnings

KOCHI TO GOA OFFSHORE SAILING RACE COMMEMORATING AZADI KA AMRIT MAHOTSAV

As part of commemorative activities of Azadi ka Amrit Mahotsav, Indian Navy is conducting an Offshore Sailing Regatta from Kochi to Goa under aegis of Indian Naval Sailing Association (INSA). Six Indian Naval Sailing Vessels (INSVs) viz Mhadei, Tarini, Bulbul, Neelkanth, Kadalpura and Hariyal will be participating in this event. The race is scheduled to start on 24 Oct 21 for a tentative duration of five days and would cover an approximate distance of 360 nm between the start point at Naval Base, Kochi to Goa. The expedition is aimed at fostering the spirit of adventure and ocean sailing for the participating crew. 

          Each of the six INSVs – four 40 footers and two 56 footers, would be manned by six naval personnel drawn from three Commands of Navy, the ANC and IHQ MoD (Navy). In addition, Ocean Yachts from Yachting Association of India (YAI) affiliated civilian clubs would also be participating in the event. The expedition is being organised by HQSNC and Indian Navy’s Ocean Sailing Node (OSN), located at INS Mandovi, Goa. The participants have been practicing for this event over the last one month and have also undergone a Capsule Course at Kochi to hone their skills. Indian Navy participants include Capt Vipul Meherishi, Capt Atool Sinha, Lt Cdr K Pednekar, Lt Cdr Payal Gupta etc, who have won medals in various events at the National level and are representing different Commands. 

          Two 56 footers participating in this Regatta have already made history in the Indian Navy by participating in circumnavigation. Mhadei has done solo circumnavigation ‘Sagar Parikrama’ with Capt Dilip Donde in 2010 and Cdr Abhilash Tomy in 2013. She has also participated in the Cape Town to Rio de Janeiro races in 2011, 2014 & 2017. Tarini has done circumnavigation of the globe ‘Navika Sagar Parikrama’ in 2017 with all women officers crew. 

          The OSN holds the Ocean Sailing yachts of Indian Navy. The crew are selected from volunteers with adequate sea sailing experience. Ocean sailing is an extremely tough adventure sport and through this, Indian Navy inculcates the spirit of adventure, enhancing risk taking abilities whilst honing essential seamanship skills including navigation, communication, technical operations of engines and onboard machinery, operation of Inmarsat equipment, logistics planning etc. It also enhances Indian Navy’s ability to project its benign presence across the globe by participating in sailing expeditions like Sagar Parikrama and Cape Town to Rio de Janeiro races, IONS sailing expedition etc. 

          The  Azadi ka Amrit Mahotsav Offshore Race will be flagged off from Kochi by FOC-in-C (South) on 24 Oct 21. The Flagging in ceremony of the race will be presided over by Commandant, Naval War College (NWC) at Goa on 29 Oct 21.

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ABB/VM/PS              

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