17th Apr 2019 08:59
LONDON (Alliance News) - Hunting PLC on Monday said profit and revenue in the first quarter of 2019 were consistent with the fourth quarter of 2018, although offshore focused operations in the US suffered a "slow and challenging" market.
Energy services group Hunting has reported underlying earnings before interest, taxation, depreciation, and amortization of approximately USD35.0 million, an increase of 7.0% from around USD32.7 the year before.
"The first quarter of 2019 saw a continuation of the level of revenue and profit reported in the fourth quarter with our US onshore completions focused businesses remaining busy, however, offshore focused operations continue to face slow and challenging markets, particularly in the Gulf of Mexico and the North Sea," said Hunting.
The company's US results for the period were, overall, ahead of expectations and benefited particularly from demand in onshore completions and capital equipment markets.
In Canada, however, particularly cold weather in late January and early February led to reduced activity levels which hurt volumes and margins. An improving trend was reported in March.
In Europe, the North Sea was historically low while Middle East regional activity was up, helping Hunting's Saudi Arabian operations. Asia-Pacific revenue was ahead of management expectations.
The company's Hunting Titan unit, which manufactures perforating systems and other drilling hardware, reported revenue ahead of the fourth quarter of 2018 but increased competition resulted in a narrowed margin.
Hunting's net cash position on March 31 was around USD45.0 million before dividends, down from USD61.3 million on December 31 due to working capital cash absorption totalling USD40 million due to the settling of trade receivables and trade payables, as well as USD9.0 million of capital investment and cash bonus award settlement with employees from 2018.
"The outlook for the remainder of the year remains positive for the group, given the market backdrop of an improved oil price, which reports an increase in excess of 40% since the start of the year. Market commentators also predict improving market sentiment as US shale plays overcome takeaway capacity issues. Therefore, the group remains well positioned to capture opportunities from this market environment," said Hunting.
Shares in Hunting were down 1.9% at 637.50 pence on Wednesday morning.
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