Six months ended 30 June 2016
Six months ended 30 June 2015
Exceptional items and certain re-measurements
Exceptional items and certain re-measurements
Net profit/(loss) before losses on Laggan-Tormore project
EBITDA before losses on Laggan-Tormore project
Strong growth in revenue to US$3.9 billion (2015: US$3.2bn) with record activity levels
Strong growth in net profit and EBITDA reflecting the phasing of profit recognition
- Group order intake of US$1.0 billion in 1H 2016; strong bidding pipeline for Engineering & Construction for 2H 2016 and 2017
Good progress on delivering cost efficiencies from Group reorganisation and operational excellence initiatives
Ayman Asfari, Petrofac’s Group Chief Executive commented on the results:
“We have delivered a positive set of results for the first half of the year, reflecting good project execution. We are on track to meet expectations for the full year 2016 and our high level of backlog gives us excellent revenue visibility for 2017.
“While there have been few project awards in our core markets in the year to date, we have a strong pipeline of bidding opportunities and we are actively bidding on a large number of projects. We have one of the most cost-competitive delivery capabilities in our industry, enabling us to maintain our bidding discipline while delivering value for our clients.
“We have made good progress towards reducing the capital intensity of the business and we remain committed to delivering value from the IES portfolio.”
Engineering & Construction (E&C)
- Fully demobilised from the Laggan-Tormore project site and provisional acceptance certificate received from client, confirming completion of project
- Delivered good performance on our portfolio of lump-sum engineering, procurement and construction (EPC) projects
- Currently actively bidding on a large number of projects where award is expected in 2H 2016 or 1H 2017
Engineering & Production Services (EPS)
- Delivered improved performance from our reimbursable and engineering, procurement and construction management (EPCm) projects
- Secured US$500 million of new contracts and extensions in the UK North Sea, including: a Service Operator contract with Anasuria Operating Company Limited, a Duty Holder contract with BP and a 3-year contract extension for Total E&P UK
- In July, secured two major contracts with Repsol Sinopec for the provision of engineering support services and onshore and offshore personnel
Integrated Energy Services (IES)
Agreement reached with PETRONAS for cessation of the Berantai Risk Service Contract which will result in accelerated reimbursement of outstanding capital and operational expenditures(8)
FPF1 floating production facility now on location on the Stella field having completed onshore commissioning
Production from the Chergui gas plant in Tunisia has been shut-in for most of the year to date due to civil unrest in the country
Continue to work towards migration of our Production Enhancement Contracts (PECs) to Production Sharing Contracts (PSCs) in Mexico
Formally exited Ticleni PEC in Romania in August 2016
In what is a challenging period for the industry, we are well-positioned. We remain focused on our core proposition: strong project execution, clear geographic focus, a disciplined approach to bidding and a sustainable, cost-effective structure.
Our backlog stands at high levels, giving us excellent revenue visibility for 2H 2016 and 2017 and our overall portfolio is in good shape. We have a strong pipeline of bidding opportunities and we are actively bidding on a large number of projects in our core markets.
We continue to drive cost optimisation and operational excellence to improve upon our already very cost-effective structure. We have one of the most cost-competitive delivery capabilities in our industry, enabling us to maintain our bidding discipline while delivering value for our clients.
We have made good progress towards reducing the capital intensity of the business and we remain committed to delivering value from the IES portfolio. We continue to manage the balance sheet to support the dividend and deliver shareholder value.
View the Group's financial statements for the six months ended 30 June 2016.
Our half year results presentation for analysts and investors will be held at 9.30am today, which will be webcast live via:
This announcement contains forward-looking statements relating to the business, financial performance and results of Petrofac and the industry in which Petrofac operates. These statements may be identified by words such as “expect”, “believe”, “estimate”, “plan”, “target”, or “forecast” and similar expressions, or by their context. These statements are made on the basis of current knowledge and assumptions and involve risks and uncertainties. Various factors could cause actual future results, performance or events to differ materially from those described in these statements and neither Petrofac nor any other person accepts any responsibility for the accuracy of the opinions expressed in this presentation or the underlying assumptions. No obligation is assumed to update any forward-looking statements.