UAE-based Lamprell plc reported to the London Stock Exchange today that it expected 2018 revenues to be around US$235 million, consistent with previous guidance, with a net loss of approximately $71 million, subject to audit, for the year ending 31st December 2018. Audited results are due to be published in March.
The company’s shares (LAM.L) were flat in early trading, up by less than one percent from a year-low of 56 pence.
Lamprell, with over 40 years experience, is a leading provider of fabrication, engineering and contracting services to the offshore and onshore oil and gas and renewable energy industries.
A company statement ascribed the predicted loss to pressures on margins, along with the fact that there had been no margin contribution from the East Anglia One project, offshore UK, in 2018.
As anticipated, the net cash position of the company trended downwards during the second half of 2018, with an expected net cash position at year-end of $80 million, the statement said. It added, however, that the backlog of orders won but not yet delivered had risen from $61.7 million at the end of 2017 to around $540 million at the end of 2018.
Looking ahead, Lamprell won two significant new contracts in late 2018, one of over $200 million for foundations for the Moray East windfarm, off the east coast of Soctland, and a Letter of Intent for a contract to construct two jackup drilling units ultimately for use in Saudi Arabia. During 2018, Lamprell completed refurbishment on a record number of 23 jackup rigs, compared to 13 refurbishment projects completed the previous year.
“Despite the challenges of the market environment in 2018, we have delivered against the objectives that we set out earlier in the year,” Christopher McDonald, Lamprell’s Chief Executive Officer, commented. “We finished the year with a major renewables project added to our order book and two new build jackup rigs committed for construction at Lamprell’s yards in the UAE. The quality and size of our bid pipeline is improving and we look forward to adding further significant projects as part of Saudi Aramco’s LTA programme during the course of the year. Given the ongoing uncertainty in the industry, this reconfirms our confidence that Lamprell’s strategy will deliver growth for the business from 2019 onwards.”
Lamprell employs more than 3,000 people across multiple facilities, with its primary facilities located in Hamriyah, Sharjah and Jebel Ali. In addition, the Group has facilities in Saudi Arabia through a joint venture agreement.