13th Nov 2015 08:26
LONDON (Alliance News) - Enteq Upstream PLC on Friday said its pretax loss narrowed in the first half, but this came amid a massive fall in activity for the company, as the downturn in the oil and gas industry sent its revenue plunging.
The oil and gas services company, which supplies drilling products and engineering services to the energy industry, said its pretax loss narrowed to USD1.3 million for the six months to the end of September from USD2.2 million a year earlier.
But revenue for the group dropped to only USD3.0 million from USD13.6 million, meaning the narrowed loss was only achieved as the volume of work the group handled in the first half dropped significantly, reducing cost of sales, and as Enteq also booked lower one-off charges.
Enteq said its revenue continued to decline in the first half, having fallen heavily in the second half of its 2015 financial year, in line with the sharp fall in the rig count, as oil and gas companies defer spending on projects and cancel work to cope within a low oil price environment.
The company said it expects the oil price and the North American rig count to remain depressed until at least 2017 and said spare equipment capacity in the market is still hitting demand for its products.
"Enteq's reported results mirror recent announcements from other major oil-field service companies. As expected, Enteq's revenues and profits have suffered due to the scale of the industry downturn," said Neil Warner, Enteq's chairman.
Shares in Enteq were down 9.5% to 13.57 pence on Friday morning.
By Sam Unsted; [email protected]; @SamUAtAlliance
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