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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Gulf Marine Services Plc | LSE:GMS | London | Ordinary Share | GB00BJVWTM27 | ORD 2P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-0.10 | -0.43% | 23.00 | 22.80 | 23.30 | 23.30 | 22.70 | 22.90 | 863,613 | 16:35:26 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Ship Building And Repairing | 133.16M | 25.33M | 0.0249 | 9.36 | 236.82M |
TIDMGMS
RNS Number : 6327A
Gulf Marine Services PLC
02 June 2021
FOR IMMEDIATE RELEASE 2 June 2021
Gulf Marine Services PLC
('Gulf Marine Services', 'GMS', 'the Company' or 'the Group')
2020 ANNUAL REPORT AND NOTICE OF 2021 ANNUAL GENERAL MEETING
The Company advises that the 2020 Annual Report, the Notice of the 2021 Annual General Meeting and Proxy Form are being made available to Shareholders electronically today, 2 June 2021. The 2020 Annual Report and the Notice of 2021 Annual General Meeting will be available shortly on the Company's website at www.gmsplc.com .
In accordance with Listing Rule 9.6.1R, copies of these documents are being submitted to the UK Listing Authority via a National Storage Mechanism and will shortly be available to the public for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism .
In accordance with Disclosure Guidance and Transparency Rule 6.3.5, additional information is set out in the appendices to this announcement. This information is extracted from the 2020 Annual Report. The appendices should be read in conjunction with the Company's Full Year 2020 Results Announcement , issued at 07:00 on 14 May 2021, RNS Number 5086Z . This material is not a substitute for reading the full 2020 Annual Report.
Mailing of the 2020 Annual Report, Notice of the 2021 Annual General Meeting and Proxy Form to Shareholders will commence shortly.
The Company will hold its Annual General Meeting (the 'AGM') at 2:30p.m (UAE time) on Wednesday, 30 June 2021. Further details are included in the Notice of the AGM. Due to the continued unpredictability caused by the COVID-19 Pandemic and uncertainty relating to the lifting of the coronavirus restrictions as set out in the letter accompanying the notice of AGM, Shareholders and others are unlikely to be able to attend the AGM in person and are therefore strongly encouraged not to attend and to cast their votes by proxy appointing the Chairman of the meeting as proxy to vote on their behalf.
In light of the coronavirus restrictions, the AGM arrangements will be as set out below:
-- The Company expects only one Director and another GMS designated Shareholder representative to be in attendance at the venue for quorum purposes to conduct the business of the meeting.
-- No other Directors will be present in person.
-- Shareholders are unlikely to be permitted to attend the Company's AGM in person and, if they attempt to do so, may be refused entry to the meeting in line with current coronavirus restrictions and under the Company's Articles.
-- There will be no update on trading or other management statements given at the AGM.
-- Shareholders are encouraged to submit questions about the business of the AGM in advance of the meeting by email ( cosec@gmsplc.com ) and, in so far as relevant to the business of the meeting, questions will be responded to by email and taken into account as appropriate at the meeting itself.
-- Voting at the AGM will be by way of a poll so that all the votes cast in advance by Shareholders appointing the Chairman of the Meeting as their proxy to vote on their behalf, can be taken into account. Shareholders have one vote for each ordinary share held when voting on a poll and this procedure ensures that every vote can be cast.
-- The results of the AGM will be announced as soon as practical after it has taken place.
Shareholders wishing to vote on any of the matters of business at the AGM are therefore strongly encouraged to:
1. Submit their votes (as soon as possible) in advance of the meeting and in any case, by 11.30 a.m. (UK time) on 28 June 2021 through the proxy and electronic voting facilities and to appoint the Chairman of the meeting as their proxy for this purpose.
2. Submit any questions in connection with the business of the meeting in advance to the Company Secretary at cosec@gmsplc.com .
3. Look out for any updates in connection with the arrangements for the AGM via RNS and on the Company's website.
Appendix A
Statement of Directors' Responsibilities
The following responsibility statement is repeated here solely for the purpose of complying with DTR 6.3.5. This statement relates to and is extracted from page 75 of the 2020 Annual Report.
These responsibilities are for the full 2020 Annual Report and not the extracted information presented in this announcement or otherwise.
We confirm that to the best of our knowledge:
-- the financial statements, prepared in accordance with the relevant financial reporting framework, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company and the undertakings included in the consolidation taken as a whole;
-- the strategic report includes a fair review of the development and performance of the business and the position of the Company and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face; and
-- the annual report and financial statements, taken as a whole, are fair, balanced and understandable and provide the information necessary for shareholders to assess the Company's position and performance, business model and strategy.
The Directors of the Company and their responsibilities as at 21 May 2021 are set out below:
Mansour Al Alami, Executive Chairman
Hassan Heikal, Non-Executive Deputy Chairman
Rashed Al Jarwan, Senior Independent Non-Executive Director
Jyrki Koskelo, Independent Non-Executive Director
Appendix B
Principal risks and uncertainties
The following has been extracted from pages 21 to 24 of the 2020 Annual Report:
The rating of the principal risks facing the Group in the short to medium term are set out below, together with the mitigation measures. These risks are not intended to be an exhaustive analysis of all risks.
Risk Mitigating factors and actions 1 Utilisation ----------------------------------------------------- Utilisation levels may be reduced Modification flexibility for clients by the following root causes: GMS' vessels are built to be as -- Increasing competition as other flexible as possible allowing the market participants increase the supply Company to compete for a wide share of SESVs in the markets in which GMS of the market, helping it to maximise operates; utilisation levels and charter day -- Sustained lower expenditure and rates. The Group is capable of modifying investment by the oil and gas industry assets to satisfy client requirements. may result in lower levels of maintenance being performed on existing platforms Continuous communication with clients and facilities and lower levels of The Group maintains strong relationship construction and capital expenditure with its clients through continuous in respect of new installations; communication and a history of providing -- Reliance on a limited number of safe and reliable services. NOCs, IOCs and international EPC clients; -- Fleet capabilities may no longer Business segment and geographical match with changing client requirements. diversity Failure to deliver the specifications The Group has established businesses and expected performance could lead outside its core Middle Eastern to reputational damage and impact markets (particularly in the North GMS' ability to win work; and Sea), and outside of oil and gas -- Reduced utilisation may materially (renewables). It is continually adversely affect our business, financial reviewing opportunities looking condition and results of operations. to diversify its market footprint through increasing the client base. Vessel monitoring The Group has procedures in place, such as the Planned Maintenance System, to ensure that the vessels undergo regular preventative maintenance. The Group's robust operating standards result in minimal downtime. ----------------------------------------------------- 2 Inability to secure an appropriate capital structure - equity ----------------------------------------------------- Under the terms of the latest bank Renegotiation of bank facilities deal signed on 31 March 2021, GMS The Group recently announced improved is required to raise US$ 25 million terms on its bank facilities and by 30 June 2021 and a total of US$ plans for raising a minimum of US$ 75 million by 31 December 2022. Failure 25 million of new equity (net) by
to do this would lead to an inadequate 30 June 2021, with the remaining capital structure and a potential balance of up to US$ 75 million event of default. in total by the end of 2022. The need to obtain shareholder approval and raise the first tranche of US$ 25 million of equity by 30 June 2021 to avoid an event of default indicates a material uncertainty that may cast significant doubt as to the Group's ability to continue as a going concern. Notwithstanding this material uncertainty, the Directors believe that there is good reason to believe that there will be sufficient shareholder support to complete the first equity raise on time. Refer to Note 3 of the consolidated financial statements. Beyond that, the Board is focused on sustaining operational excellence while enhancing performance and utilisation of GMS' assets to explore and secure new opportunities. This will be key to driving improved profitability and cash flow, which is expected to deliver shareholder confidence and a higher share price. ----------------------------------------------------- 3 Mena Oil and Gas Market ----------------------------------------------------- MENA NOCs have local content requirements Local content requirements as part of their tender processes GMS embraces local content requirements, designed to give preference to suppliers with a long history of operating that commit to improving their local for NOCs in the Middle East and content and levels of spend and investment established offices in each of the in-country. This may prevent GMS from MENA countries the Group operates. winning contracts or lead to financial The Group actively manages its supply loss and/or a reduction in margins chain to ensure that they also are on existing contracts, which will focused on maximising local content ultimately impact cash flows and profitability. and where necessary will work with local partners in specific markets to ensure it positions itself in the best possible position to win work. Often during the tendering process companies with a higher audited local content score are given the offer of first refusal to price match any lower bids during tendering. Market knowledge and operational expertise The Group has a track record of established long-term relationships in the MENA region which provides an understanding of clients' requirements and operating standards. ----------------------------------------------------- 4 Operations: inability to deliver safe and reliable operations ----------------------------------------------------- The Group may suffer commercial and Safety awareness reputational damage from an environmental Safety and reliability are top priorities or safety incidents involving employees, and are underpinned by the HSEQ visitors or contractors. management system and a strong safety-focused The physical risk of climate change, culture. Management ensures appropriate such as natural disasters or extreme safety weather events may impact our ability practices and procedures; disaster to operate. Inadequate preparation recovery plans and insurance cover for emergency situations, such as of all commercial contracts in place. pandemics, geopolitical instability, could have a negative impact on the All of our vessels are designed business. to withstand extreme weather events as specified by the Class Society. Insufficient insurance coverage may lead to financial loss. Training and compliance Our employees undergo continuous training on operational best practices. Scheduled maintenance The Group follows regular maintenance schedules on its vessels and the condition of the vessels is consistently monitored. Business continuity plan The Group has in place a business continuity management plan which it regularly maintains. Insurance The Group regularly liaises with insurance brokers to ensure sufficient coverage is in place. ----------------------------------------------------- 5 Liquidity and covenant compliance ----------------------------------------------------- The business is exposed to short-term Liquidity management liquidity management risks arising The Group continues to manage liquidity from potential increases in interest carefully through focusing on receivables rates, which further increase debt collections and managing the timing service obligations, and unexpected of supplier payments. increases in working capital (particularly through inability Cost management to collect receivables). The Group has implemented a comprehensive cost reduction programme, removing In addition, the Group's bank facilities over US$ 20 million of annualised are subject to covenant tests based costs in order to generate higher on the financial performance. Compliance EBITDA and increased cash to service with these covenants depends on GMS' debt. Continual review of costs
ability to secure ongoing work for and search for further efficiencies the fleet. If GMS is unable to do is ongoing. so the financial performance and position may be materially adversely affected Minimising capital expenditure and it may not comply with the covenants. The Group is focused on restricting In such a case, unless the capital expenditure to essential banks agree otherwise this could lead spending only, to ensure the safe to an event of default. This would and reliable operations of its vessels. give lenders the right to accelerate repayment of the outstanding loans, Covenant compliance and then exercise The management team and Board regularly security over the Group's assets. examine future covenant compliance based on the latest forecasts and take necessary actions to avoid any potential where a future breach of covenant is forecast. ----------------------------------------------------- 6 People ----------------------------------------------------- Attracting, retaining, recruiting Communication and engagement and developing a skilled workforce Communication has remained a key is key. practice of management, especially during the COVID-19 pandemic. During Losing skills or failing to attract the year, the focus for employees new talent to the business has the has been on safety and wellbeing potential to undermine performance. through working remotely, regular testing and enhanced cleaning procedures. Inadequate succession planning and lack of identification of critical In 2021, Rashed Al Jarwan was appointed roles may result in disruption if as the new Workforce Engagement the related personnel leave the Group. Director, explicitly tasked with monitoring the level of engagement and alignment across the organisation. Remuneration Policy The Short-Term Incentive Plan (STIP) is based on a single Business Scorecard to ensure all staff are incentivised around delivering a single set of common goals. Equal opportunities GMS is engaged in fair and transparent recruitment practices. It has a zero-tolerance policy towards discrimination, and provides equal opportunities for all employees. Resource planning The Group is in the process of identifying critical roles and preparing plans to ensure smooth transition in case of changes in personnel. Refer to the Governance Report on pages 34 to 37 for details of changes at the Board level and assessment of what skills the new Board brings to GMS. ----------------------------------------------------- 7 Legal, economic, and political conditions ----------------------------------------------------- Political instability in the regions Emergency response planning and in which GMS operates (and recruit insurance from) may adversely affect its operations. For all our major assets and areas of operation, the Group maintains emergency preparedness plans. It regularly reviews the insurance cover over the Group's assets to ensure adequate cover is in place. Workforce planning and monitoring Workforce planning and demographic analysis is completed in order to increase diversity. ----------------------------------------------------- 8 Compliance and regulation ----------------------------------------------------- Non-compliance with anti-bribery and Code of Conduct corruption regulations could damage The Group has a Code of Conduct stakeholder relations and lead to which includes anti-bribery and reputational and financial loss. corruption policies, and all employees are required to comply with this GMS' operations are subject to international Code when conducting business on conventions on - and a variety of behalf of the Group. Employees are complex federal and local laws, regulations required to undergo in-house training and guidelines relating to on anti-corruption. All suppliers - health, safety and the protection are pre-notified of anti-bribery of the environment. Compliance with and corruption policies, and required these health, safety and environmental to confirm compliance with these conventions, laws and regulations policies. has become increasingly expensive, complex and stringent. Failure to Regulations appropriately identify and comply A central database is maintained with laws and regulations, and other which documents all of GMS' policies regulatory statutes in new and existing and procedures which comply with markets, could lead to regulatory laws and regulations within the investigations. It may result in GMS countries in which we operate. On failing to win a new contract, the specialist topics, the Group makes early termination of an existing contract use of external advisers, where or exclusion from future contracts. appropriate. A dedicated Company Secretary is in place to help monitor compliance, in particular with regard to UK legal and corporate governance obligations. External review The Internal Audit function helps ensure compliance with GMS policies, procedures, internal controls and business processes. The Group's vessels are also audited
by external bodies such as the American Bureau of Shipping (ABS). ----------------------------------------------------- 9 COVID-19 pandemic ----------------------------------------------------- The COVID-19 pandemic has presented Hygiene measures a number of challenges. GMS implemented extensive hygiene control and prevention measures Measures introduced in jurisdictions across the fleet and onshore offices. where GMS operates, include closing Clients have adopted similar measures, of international borders and strict in many cases in compliance with quarantine requirements for crew, strict government directives in which could lead to further increased force across the countries in which cost. These measures can change at the Group operates. short notice, maintaining the risk that offshore staff will be unable COVID-19 vaccinations to crew change. COVID-19 vaccines are available in some of the countries where GMS There is a health risk to staff, both operates and have been made available onshore and offshore, who come into to staff, both onshore and offshore. contact with confirmed cases. Offshore rotations COVID-19 restrictions on travel may Crew rotations have been extended impact GMS' ability to allow third as a temporary measure to minimise parties to travel to its vessels to impact of quarantine requirements inspect, maintain or certify equipment of some clients. onboard, which increases the risk of equipment failure and being put Vessel maintenance off hire. The Group has in place a strict management of change process, which Existing or future contracts are delayed ensures where it has been unable by our clients as a result of interruptions to have equipment tested, inspected in their supply chains resulting in or certified offshore, due to the them being unable to carry out work availability of suitably qualified as planned. personnel offshore, that an appropriate risk management process is in place. Contract delays Through strong relationships with its client base, GMS is in regular communication around any operational delays that are expected that could impact the Group. In such circumstances and with client agreement, GMS will seek other opportunities to utilise the fleet and minimise the financial impact on all parties. ----------------------------------------------------- 10 Cyber-crime - security and integrity ----------------------------------------------------- Phishing attempts result in inappropriate Cybersecurity monitoring and defence transactions, data leakage and financial GMS operates multi-layer cyber-security loss. The Group is at risk of loss defences which are monitored for and reputational damage through financial effectiveness to ensure they remain cyber-crime. up to date. GMS engages with third party specialists to provide security services. -----------------------------------------------------
- Ends -
Enquiries: GMS Mansour Al Alami, Executive Chairman +44 (0) 207 603 1515 Celicourt Communications Mark Antelme Philip Dennis +44 (0)20 8434 2643
Gulf Marine Services PLC's Legal Entity Identifier is 213800IGS2QE89SAJF77
www.gmsplc.com
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