Maritime Strategies International (MSI) research and consultancy firm, is bringing increased transparency to current and future asset valuations in the offshore vessel sector extending its online valuation tool, FMV, to cover the OSV sector at a time when many owners and their lenders are working to agree long term restructuring plans.
FMV provides instant access to key vessel valuation indicators in the main shipping markets and can be used on a simple pay-as-you go or subscription basis.
Despite recent rises in the oil price, 2017 looks set to be as challenging for the OSV markets as 2016, with upward blips in vessel earnings scarcely being reflected in asset values. As an example, FMV data pegged earnings for an Asian-built AHTS of around 11,000 BHP at $6,800/day in Q4 2016, down by a third compared to Q4 2015 and down by two thirds from the heyday of 2013/14.
These declines have understandably put pressure on the process of accurately predicting asset values says MSI Senior Analyst, James Frew:
“Some recent efforts to undertake restructuring in the offshore sector have been hampered by disagreements over the future trajectory of asset values. The independent, third-party price assessments which FMV brings to the market, will be vital in helping owners and their lenders best define their future strategies.”
MSI believes that even under a market recovery scenario a significant proportion of the debt on assets purchased at the top of the cycle is unrecoverable. However, efforts to address this have been hampered by a lack of transparency over current pricing and disagreements over the future trajectory of asset values.
In addition to providing historical data, FMV provides a unique insight into future values and cash flows with near-term perspective provided via quarterly forecasts and a longer view provided by 15 years of annual average forecast data.
The inclusion of OSVs into FMV allows finance providers, owners and interested parties to value assets in a clear and transparent fashion at actual market levels, adds Frew.
“There is no disguising the challenges to be faced in 2017 by both the owners and financiers of OSVs. In this context the ability to find common ground, both in terms of today’s market position and the envelope of possible recovery dynamics, is key to making the correct decisions.”
Source: Maritime Strategies International
