Gulf Marine Services PLC New Debt Structure (1963I)

TIDMGMS

RNS Number : 1963I

Gulf Marine Services PLC

31 March 2020

This announcement contains inside information and is provided in accordance with the requirements of Article 17 of the EU Market Abuse Regulation.

Gulf Marine Services PLC

('Gulf Marine Services', 'GMS', 'the Company' or 'the Group')

GMS Agrees New Debt Structure to Establish Long Term Financial Sustainability

Gulf Marine Services announces that it has reached agreement (the "Agreement") with its syndicate of banks (the "Banks") on heads of terms for the restructuring of its debt facilities, including access to existing term loan facilities and new working capital facilities (the "Facilities"). The Agreement is the result of constructive discussions over the past several months and highlights the Banks continued support of the Group and confidence in the business model.

The Agreement is a key step towards GMS's objective of achieving a sustainable and delevered capital structure. Specifically, the Agreement provides GMS the financial flexibility to execute its business plan successfully with:

   --      Renewed existing term loan facilities with an extended maturity to 30 June 2025; 
   --      Enhanced liquidity through a new $50m working capital facility; 
   --      Re-phased amortization requirements; 
   --      Increased financial covenant headroom; and 

-- Incentives to de-lever through a shareholder equity raise, failing which will require the issuance of preferential securities, and/or the incurrence of PIK interest, to the Banks.

The Agreement, while legally non-binding, has received approval from the credit committees of all of the Banks. GMS and the Banks are working to finalise the documentation of the Agreement by 30 June 2020. To allow this process time to conclude, the Banks have granted GMS relief under its existing bank facilities in the form of (i) the rollover of certain loans, (ii) the waiver of applicable financial covenant tests and (iii) the deferral of the principal payments due thereunder, in each case from 31 March 2020 until 30 June 2020.

The Company intends to seek shareholder approval, when equity markets allow, to undertake a share capital increase before the end of 2020, with the aim of raising at least $75m of net proceeds (the "Capital Increase").

Further details of the Capital Increase will be announced in due course.

GMS notes the extraordinary turbulence of global markets as a result of the ongoing impact of COVID-19, as well as related commodity price volatility. The Company is actively monitoring the impact of these events on its business and is operating in accordance with all applicable government guidelines.

Tim Summers, Executive Chairman, Gulf Marine Services, said:

"GMS is operating in extraordinary times: the health and safety of our staff, contractors and customers, remain our determined focus.

Reviewing the last six months, we have made substantial progress: reducing the size of the organisation, cutting costs and winning substantial new business. As a result, we have markedly improved operational and financial performance. This Agreement with our banks provides the foundations for the resetting of our capital structure. GMS today is in a much healthier and stronger position to face the unique challenge of COVID-19 as well as continued oil price volatility. "

GMS announces that, at the request of the Financial Conduct Authority (FCA), to "observe a moratorium on the publication of preliminary financial statements for two weeks", the publication of its preliminary results will be postponed beyond 6(th) April, being the planned date of their publication. A further announcement will be made once a revised date for publication has been determined.

As previously announced, GMS expects 2019 EBITDA to be at the top end of the guidance of $48-50m.

Enquiries

For further information please contact:

 
Gulf Marine Services 
 PLC                      Brunswick 
 Tim Summers              Patrick Handley - UK 
 Executive Chairman       Will Medvei - UK 
 Tony Hunter              Tel: [phone] 
 Company Secretary        Jade Mamarbachi - UAE 
 Tel: [phone]     Tel: [phone] 
 1515 
 

Notes to Editors:

Gulf Marine Services PLC, a company listed on the London Stock Exchange, was founded in Abu Dhabi in 1977 and has become a world leading provider of advanced self-propelled self-elevating support vessels (SESVs). The fleet serves the oil, gas and renewable energy industries from its offices in the United Arab Emirates, Saudi Arabia and the United Kingdom. The Group's assets are capable of serving clients' requirements across the globe, including those in the Middle East, South East Asia, West Africa, North America, the Gulf of Mexico and Europe.

The GMS fleet of 13 SESVs is amongst the youngest in the industry, with an average age of eight years. The vessels support GMS's clients in a broad range of offshore oil and gas platform refurbishment and maintenance activities, well intervention work and offshore wind turbine maintenance work (which are opex-led activities), as well as offshore oil and gas platform installation and decommissioning and offshore wind turbine installation (which are capex-led activities).

The SESVs are categorised by size - K-Class (Small), S-Class (Mid) and E-Class (Large) - with these capable of operating in water depths of 45m to 80m depending on leg length. The vessels are four-legged and are self-propelled, which means they do not require tugs or similar support vessels for moves between locations in the field; this makes them significantly more cost-effective and time-efficient than conventional offshore support vessels without self-propulsion. They have a large deck space, crane capacity and accommodation facilities (for up to 300 people) that can be adapted to the requirements of the Group's clients.

Gulf Marine Services PLC's Legal Entity Identifier is 213800IGS2QE89SAJF77

www.gmsuae.com

Disclaimer

The content of the Gulf Marine Services PLC website should not be considered to form a part of or be incorporated into this announcement.

Cautionary Statement

This announcement includes statements that are forward-looking in nature. All statements other than statements of historical fact are capable of interpretation as forward-looking statements. These statements may generally, but not always, be identified by the use of words such as 'will', 'should', 'could', 'estimate', 'goals', 'outlook', 'probably', 'project', 'risks', 'schedule', 'seek', 'target', 'expects', 'is expected to', 'aims', 'may', 'objective', 'is likely to', 'intends', 'believes', 'anticipates', 'plans', 'we see' or similar expressions. By their nature these forward-looking statements involve numerous assumptions, risks and uncertainties, both general and specific, as they relate to events and depend on circumstances that might occur in the future.

Accordingly, the actual results, operations, performance or achievements of the Company and its subsidiaries may be materially different from any future results, operations, performance or achievements expressed or implied by such forward-looking statements, due to known and unknown risks, uncertainties and other factors. Neither Gulf Marine Services PLC nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. No part of this announcement constitutes, or shall be taken to constitute, an invitation or inducement to invest the Company or any other entity, and must not be relied upon in any way in connection with any investment decision. All written and oral forward-looking statements attributable to the Company or to persons acting on the Company's behalf are expressly qualified in their entirety by the cautionary statements referred to above.

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March 31, 2020 04:52 ET (08:52 GMT)