Sembcorp Marine Ltd., the world’s second-biggest builder of oil rigs, joined its larger rival Keppel Corp. in reporting a profit slump last quarter as projects were deferred or canceled due to low crude oil prices. Shares fell.
Net income at Singapore-based Sembcorp plunged 90 percent in the quarter through June to S$11.5 million ($8.5 million) from S$109.2 million a year earlier, the company said in a statement to the Singapore exchange after trading hours Thursday. Sales dropped 25 percent to S$908.5 million.
Battling weak demand, the company said it will slash this year’s capital spending to half of 2015, adding it will continue to focus on costs, liquidity and balance sheet management during these “challenging times.” Oil prices that have dropped 60 percent in the past two years have dried up demand for for drilling and production, pushing many Asian shipyards to cut jobs and consider temporary closure of docks.