Keppel Corp., the world’s largest builder of oil rigs, posted a 48 percent drop in second-quarter profit as oversupply led to delivery delays for offshore projects, and said it doesn’t expect demand for rigs to return soon.
Net income dropped to S$205.8 million ($152 million) from S$396.7 million a year earlier, Keppel said in a statement Thursday. Revenue fell 37 percent to S$1.63 billion.
With crude prices down more than 50 percent in the past two years, oil companies have cut spending and rig operators face rising debt, causing them to ask shipyards to cancel or delay deliveries of offshore drilling rigs and production facilities. Keppel, which gets about half its profit from building rigs, also has been hit by non-payment by one of its biggest clients, Sete Brasil Participacoes SA, which filed for bankruptcy protection in April.