SBM Offshore lifts 2025 outlook after strong half-year results (updated)

SBM Offshore NV

07/08/2025 06:40

Adds shares and divisional details in paragraphs 5-6, management comments on tariffs in paragraphs 7-9

By Anna Peverieri

Aug 7 (Reuters) - SBM Offshore SBMO.AS nudged up its annual forecasts on Thursday, buoyed by strong first-half performance in its turnkey business that builds and sells vessels to oil and gas companies.

The results were supported by the commissioning of two major floating production, storage and offloading vessels (FPSOs) in Brazil, CEO Øivind Tangen said in a press release.

SBM Offshore, which provides floating production services to the offshore energy industry, now sees directional core earnings (EBITDA) of around $1.6 billion in 2025, $50 million higher than it had originally guided.

It expects directional revenue to exceed $5 billion, after saying it would be above $4.9 billion in February.

However, the company's shares fell around 5% by 0732 GMT. Brokerage Degroof Petercam pointed out in a note that the results skewed heavily towards the turnkey segment where directional revenue doubled in the first half.

The lease-and-operate segment's directional revenue meanwhile dropped 16% and missed market forecasts.

SHIELDED FROM TARIFF IMPACT

SMB Offshore is shielded from tariff-related cost pressures as it prices bids based on current market rates and passes those costs through to clients with a margin, finance chief Douglas Wood told Reuters. Limited procurement from the U.S. also helps.

Tangen said the company's existing backlog was "hedged against inflation and change in legislation", while new bids were based on firm supplier offers.

"We don't see margin erosion on the current or future projects coming from tariffs," the CEO added.

The Amsterdam-listed company reported a 10% rise in half-year directional EBITDA to $682 million, beating analysts' consensus of $673 million provided by the company.

It uses directional reporting, which recognises revenue from payments received during construction phases before lease contracts are activated.

"The deepwater market outlook remains robust, driven by the demand for cost-efficient and low-emission oil production," Tangen said.

SBM Offshore operates in the deepwater segment, where production costs per barrel are typically lower than in other offshore regions, shielding it from oil price volatility.

 (Reporting by Anna Peverieri in Gdansk, editing by Milla Nissi-Prussak)

 ((anna.peverieri@thomsonreuters.com))