MMA flags $140m impairment

Marine services company MMA Offshore has flagged a $140 million impairment in its upcoming FY16 results, with the majority of the charge attributed to its vessel fleet.

Fremantle-based MMA told the market this morning that it expects to recognise a $100 million impairment charge in the carrying value of its vessel fleet, $37 million against its Dampier Supply Base, and $3 million against its Dampier Slipway.

“The impairment charge reflects the ongoing impact of the company’s operations of the low oil price environment, which has led to a significant reduction in oil and gas related activity in both the Australian and international markets,” MMA said.

MMA has made no false promises about a short-term turnaround in its performance, with the company last month foreshadowing similar challenging conditions experienced during FY16 to continue into the first half of the 2017 financial year.

“In determining the impairment amount, consideration has been given to the market value of the assets in each of the operating divisions as at June 30,” it said.

“This non-cash impairment charge will not impact the company’s compliance with its debt facility covenants.”

MMA booked a $120 million impairment charge in its FY15 results last year.

Shares in MMA were unchanged at 29.5 cents each at 9:30am.