- Oil price decline has led to new market opportunity, says CEO
- Company's revised strategy turned AED 90.6m (US$24.7m) loss in 2014 to a net profit of AED 71m (US$19.2m) in 2016
- New brand identity unveiled at ADIPEC today
14 November 2017 – Abu Dhabi, UAE: Abu Dhabi Ship Building PJSC (ADSB), a leading provider of construction, repair and refit services for naval, military and commercial vessels, announced today that it has expanded its services portfolio to the oil and gas industry. This is the company's first foray outside of the naval, marine and defense sector, as it opens up to opportunities beyond its traditional industries of focus.
Marking its business success and new direction, ADSB also revealed its new brand identity at ADIPEC today.
Dr. Khaled Al Mazrouei, CEO of ADSB commented: “ADSB has a proud past, with over 20 years of experience in delivering uncompromising quality and reinforcing the UAE's significant naval capabilities. With ADSB's strong performance and recent win on providing marine support services for the UAE's naval fleet, we are leveraging our relationships with our core government clients in the region to move into a new industry, as we feel that oil and gas has the potential to grow our business beyond ship building.”
The instability in oil prices since early 2014 has led the oil and gas majors into rethinking their capital expenditures, a move that has benefitted companies like ADSB, according to Al Mazrouei.
“Today, the supermajors and national oil companies are tightening their spending. Investments into new offshore and onshore assets are being put on hold, and are instead funneling their spending into routine maintenance work—a core ADSB capability. When the oil and gas industry finally gathers its momentum for major refurbishments and upgrades, there will be a huge demand on shipyards like ours. Our move into this sector demonstrates that we are gearing ourselves to meet this challenge,” he explained. “In the near to medium term, analysts have predicted that oil companies will spend tens of billions in refurbishment, upgrading and purchasing new offshore and onshore assets, meaning that we have a unique opportunity to grow our portfolio in this sector.”
Following a review of its operations in 2014, ADSB implemented a new business strategy which aimed to broaden the shipyard's traditional customer base. Since then, the company has turned its fortunes around: net profit climbed to AED 71m ($19.2m) in 2016 from an AED 90.6 million loss in 2014. Last year, the shipyard docked, repaired and serviced 285 vessels.
“ADSB's customer-centric approach is second-to-none in providing repairs, refits and upgrades for major government and private companies in the UAE and internationally. In line with Abu Dhabi's broader vision and commitment to the economy, we are making considerable investments to help broaden our international appeal and building lasting relationships with strategic partners and affiliates,” said Al Mazrouei.
Over the past year the company has completed six oil and gas projects from regional, national and international companies. Its local client base has grown to 135 from 31 UAE entities within the last three years, with its international customer portfolio growing tenfold in the same period.
The leading shipyard is tapping into new revenue streams in the merchant and offshore sectors, and has partnered with international marine sales services and agents in 17 countries that promote new build and repair services on behalf of the company.
“We are optimistic about the future,” concluded Al Mazrouei. “We have the expertise and experience in some sectors. We are confident that our 1,200-strong team can expand our capabilities to ensure the longevity of our organization, while helping our customers realize their business goals.”