Interim Results for the six months ended 30 June 2009
24 August 2009
Download the 2009 interim results in PDf format
FINANCIAL HIGHLIGHTS
- First half order intake(1) of US$5.8 billion (2008: US$1.7 billion) with backlog(2) of US$8.4 billion at 30 June 2009 (31 December 2008: US$4.0 billion)
- EBITDA(3) up 16% to US$207.5 million (2008: US$179.2 million)
- Net profit(4) for the period up 20% to US$145.6 million (2008: US$121.2 million) on revenue up 1% to US$1,586 million (2008: US$1,576 million)
- Earnings per share (diluted) up 22% to 42.70 cents (2008: 35.13 cents)
- Interim dividend up 43% to 10.70 cents (6.46 pence(5)) per share (2008: 7.50 cents)
- Gross cash balances at 30 June 2009 of US$900.2 million (31 December 2008: US$694.4 million)
Commenting on the results, Ayman Asfari, Petrofac’s group chief executive, said:
“Overall, we are very pleased with the group’s achievements in the first half of the year, and our excellent growth prospects.
“Notwithstanding the significantly lower oil price environment experienced in the first half of the year the group has performed well and, subject to any unforeseen circumstances, we are confident that we will deliver earnings growth for the full year of at least 20 per cent. With over US$6 billion of new contract awards secured in the year to date the group has record backlog giving outstanding revenue visibility and underpinning the group’s confidence that strong growth in earnings will continue well beyond the current year.”
OPERATIONAL HIGHLIGHTS
Engineering & Construction
- Successful in securing US$5.9 billion of new contract awards in the year to date (US$5.4 billion during 1H 2009), including lump-sum contracts in Abu Dhabi, Algeria, Oman and Saudi Arabia
Offshore Engineering & Operations
- Following increasing tender activity as the year has progressed, success in July in securing a £75 million 3-year contract with Apache to provide engineering and construction services for the Forties field in UK North Sea
Engineering, Training Services and Production Solutions
- Continued strong operational performance in service operator role for production of Dubai’s offshore oil & gas
Energy Developments
- Commencement of oil production from West Don field in April 2009, less than 1 year from Field Development Programme approval, followed by commencement of production from Don Southwest field in June 2009
- In July, acquired AH001 floating production facility with a view to upgrade, modification and redeployment
OUTLOOK
In Engineering & Construction, our largest reporting segment, recent contract awards are expected to support strong growth in revenue in the second half of the year. The terms on which these contracts were secured and our progress to date on these awards together with the continued good performance from the rest of our contract portfolio gives us confidence that we can maintain net margins in this segment of around 10% over the medium-term. Furthermore, our ongoing bidding activity in key markets in the Middle East and Africa and the Commonwealth of Independent States continues to position us well for the future.
Revenues in Offshore Engineering & Operations are expected to remain resilient in constant currency terms for the balance of the year. Bidding activity has increased recently and we would look to secure additional business over the coming months which will help position us for growth over the medium-term. However, we do recognise that cost control remains a high priority for our customers, particularly in high-cost markets such as the UKCS, and, as a consequence, we have implemented programmes to reduce our own fixed costs and particularly our property costs. We expect margins for the full year to be somewhat lower than last year.
In Engineering, Training Services and Production Solutions we are also seeing an increase in new business opportunities. However, activity levels in Engineering Services and Training Services are expected to remain subdued for, at least, the balance of this year.
Our near-term focus in Energy Developments remains on tying in the injection wells on the Don assets and commissioning the gas lift on the floating production facility, which is expected to lead to an increase in production levels as the year progresses. In 2010, the second phase of the development should enable us to access additional reserves, following recent discoveries in the Don Southwest field. In addition, we continue to evaluate a number of upstream and energy infrastructure opportunities.
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