Seatrium reports net order book of S$25.8B in 1QFY2024; S$11.4B in order year-to-date

SINGAPORE: Seatrium Limited, a global provider of engineering solutions to the offshore, marine, and energy industries, reported a net book order of S$25.8 billion in its business update for the first quarter of 2024.

The order comprised 31 projects with deliveries until 2030. In its latest business update for 1QFY2024, Seatrium outlined its strategic roadmap for FY2024, focusing on improving financial performance.

To achieve this, the group has identified several key areas, including implementing cost-saving initiatives to drive a leaner cost structure and executing the order book safely, timely, and on budget. 

Seatrium also aims to pursue new business opportunities, expand its pipeline, and secure lucrative order wins.

It also adopts a proactive approach to capital management, strategically optimising its financial resources to maximise shareholder value and sustain a strong balance sheet.

The company’s strong year–to–date performance also includes a notable new order of over $11.4 billion.

This is spearheaded by the $11 billion contract to build two floating production storage and offloading (FPSO) vessels, platforms P-84 and P-85, for Petrobras.

Other new orders include the Sparta FPU newbuild for Shell Inc, topsides integration contract from MODEC for the Errea Wittu FPSO, and topsides fabrication and integration contract from SBM Offshore for the Jaguar FPSO.

“We are honoured to be selected by Petrobras through a rigorous tender process to supply the P-84 and P-85 FPSO vessels, solidifying our position as the preferred partner for transformative projects.

Through the One Seatrium Delivery Model, we are integrated globally to deliver cost-effective, value-added solutions to our esteemed customers.

Leveraging our worldwide engineering, procurement and project management expertise in close collaboration with our customers, we will create quality assets with the highest safety standards and a lower carbon footprint, shaping the industry for a greener future,” expressed Mr Chris Ong, CEO of Seatrium when the company announced the Petrobras project on May 25.

The supply of the FPSO platforms will leverage the company’s ‘One Seatrium Delivery Model,’ in which operations and engineering support are integrated across different yards globally.

Seatrium’s facilities in Brazil, China, and Singapore will manufacture the modules, which weigh an impressive 60,000 metric tonnes.

The outsourced hull and accommodation will be transported to Singapore for topside module integration and commissioning.

During the first quarter of 2024, Seatrium successfully delivered Brassavola, Singapore’s first membrane liquified natural (LNG) gas bunker vessel, to owner Indah Singa Maritime Pte. Ltd, a wholly-owned subsidiary of Mitsui O.S.K Lines, completed 67 repairs and upgrade projects.

Brassavola uses dual-fuel engines, allowing the vessel to run on marine LNG for cleaner and lower-carbon operation. The vessel’s advanced reliquefaction technology also enables more efficient boil-off gas management, which reduces carbon emissions. 

Seatrium also secured a S$400 committed green revolving loan facility from UOB to support its business growth in offshore renewables by financing green and environmentally sustainable projects.

This is on top of the S$2 billion in sustainability-linked loans and green financing the company secured last year. It has set a 40% target of its net order book to comprise cleaner or greener solutions and renewable energy sources by 2030.

Seatrium also reported that it has completed the early redemption of its S$500 million floating rate bonds due in 2026 and divested the Batangas Yard in the Philippines.

During its Investor Day in March, the group unveiled its long-term sustainable targets of at least S$1 billion or more in EBITDA and ROE of 8% or higher.

This includes a net leverage of two to three times or lower, on a through-cycle basis, by FY2028 or earlier.

Following approval by its shareholders at the recent Annual General Meeting, the group established a S$100 million share buyback programme funded by existing cash.

Seatrium’s share consolidation, with every 20 existing shares converted into one share, became effective on May 9.