Marine services company MMA Offshore will sell its Dampier and Broome supply bases to Toll Group for about $53 million to pay off debt, as the company revealed a $323.7 million half-year loss on the back of a large impairment charge.
Marine services company MMA Offshore will sell its Dampier and Broome supply bases to Toll Group for about $53 million to pay off debt, as the company revealed a $323.7 million half-year loss on the back of a large impairment charge.
MMA told the market today it would sell its Dampier Supply Base for $44.1 million and its 50 per cent stake in the Broome Supply Base for $8.7 million, both to Toll Group, with the proceeds to be used for debt reduction.
The Dampier asset sale is expected to settle in June, with the Broome deal expected by April.
“Historically the supply base assets were a significant contributor to the earnings of our predominately Australian-focused operations,” MMA chairman Tony Howarth said.
“However, in recent years the supply base business has become less significant as the company has focused its strategy on its Australian and international offshore vessel operations.”
Managing director Jeff Weber said notwithstanding the assets sale, the company remained committed to the Australian market.
“We currently have 13 offshore vessels operating in Australia and the region remains a key platform in MMA’s business strategy,” he said.
“As part of our non-core asset disposal strategy, we are continuing to rationalise the smaller, more commoditised vessels from MMA’s fleet to focus on larger, more sophisticated vessels.”
MMA will retain a regional office within the Dampier Supply Base to continue supporting its vessel operations in the state’s north-west.
The news came as MMA revealed a $323.7 million net loss for the six months to December, on the back of a non-cash impairment charge of $278 million.
The result was down from a $6.5 million profit in the six months to December 2015.
MMA also widened its loss from continuing operations before including the impairment, down from $1.1 million in the red to $46.2 million.
Revenue was also slashed from $269.8 million in the previous corresponding period to $119.7 million.
Mr Howarth said the impairment charge was on the back of current market conditions, which continue to have a material impact on MMA’s asset values.
“Importantly, we retain the support of our banking syndicate and have recently agreed a revised facility agreement that balances debt repayments with ongoing liquidity requirements,” he said.
“There have been improvements in overall sentiment in the oil and gas industry with a recent stabilisation in the oil price.
“MMA will continue to focus on strengthening its balance sheet and positioning the company to take advantage of any improvement in market conditions.”
MMA shares were 21.6 per cent lower to 23.5 cents each at 11am.
