It contends that it has made sufficient provisions.
With its back against the wall, it appears like SembMarine has done everything it can to make sufficient actions to mute the damages of its contracts at risk.
However, according to analysts from UOB Kay Hian, further provisions could be made if the situation worsens, including additional profit reversals due to further cancellations.
Among the other provisions noted by UON Kay Hian include asset impairment of cancelled rigs, given that transactional rig prices have fallen near 60%.
“In the case of a), we understand that provisions for Sete Brasil, North Atlantic Drilling and Marco Polo Drilling have been made. While provisions for Oro Negro were made in 3Q15, more might be required given that Oro Negro in the near term is neither able to secure work for its remaining three rigs, nor acquire funds to meet its final instalment,” UOB Kay Hian said.
Meanwhile, other contracts that could be at risk but with no provisions made are are two Perisai Pacific jack-up rigs, as well as the Odebrecht-Teekay FPSO for the Libra field.
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