GMS Fleet Utilization at 2015 High as More Middle East Work Secured

Gulf Marine Services PLC (GMS), a UAE-bases supplier of offshore jack-up service units, has won a seven-month contract for one of its E-Class (large) vessels, and an extension for a smaller unit.

Under the 7-month contract which also includes extension options, GMS will provide support for offshore activities on behalf of a Middle East client, the company said Tuesday.

The vessel will be mobilized for the start of operations during the summer of 2020. 

GMS has also secured a two-month contract extension of a K Class (small) vessel, also for a Middle Eastern-based client.  

"This increases the total GMS fleet utilization to 82% for 2020.  The last time the GMS fleet operated at these levels of utilization was in 2015 on a calendar year basis," GMS says.

"Year to date performance remains ahead of the Business Plan, with April actuals now in.  The order book continues to be built, and fleet utilization for 2020 is now at 82% with a further 53% of the fleet secure for 2021.  Contract rates reflect current market conditions and remain within our expectations," the company added.

COVID-19 on two units

GMS said it was making progress with cost cuts, with further reductions onshore and offshore, where reductions of 6% in the offshore organization through crewing efficiencies have been achieved so far this year.  This is in addition to a 22% reduction in the onshore organization through headcount reductions achieved in the first quarter, it said.

Onshore staff continues to work remotely, and no material interruptions in the supply chain have been incurred, the company said.

GMS said that of the two vessels with reported COVID-19 cases, one has remobilized to the field already following crew testing and deep-cleaning, and the other is preparing to remobilize. 

GMS did not say when the Covid-19 cases had been confirmed, nor where.

Guidance for 2020 ($57-62 million EBITDA), previously issued on January 16, and confirmed on May 7 is reconfirmed.

Tim Summers, Executive Chairman, said "Despite challenging conditions in the upstream energy industry, the Company is trading successfully. Our continued focus on cost reduction, and improving the efficiency of our operations, underpins our ability to win business and compete strongly."