4th Feb 2016 10:55
LONDON (Alliance News) - Industrial services and rental company Northbridge Industrial Services PLC said on Thursday its results for 2015 look to be in line with management's expectations, adding the downturn in spending by oil and gas companies has prompted a streamlining of its operations, leaving it better placed to take advantage of any upturn when it arrives.
Northbridge said it cut costs and simplified its business down to two core activities over the year ending December 31, operating through the main subsidiaries Crestchic Ltd and Tasmanian Oil Tools, after much of its customer base was hit by the falling price of oil.
Crestchic is a specialist electrical equipment business, which manufactures and rents loadbanks and transformers from its base in Burton on Trent, whilst Tasman Oil Tools rents drilling equipment to the oil, gas and geothermal industries from its sites in Australia, New Zealand and Dubai.
All other non-core activities were closed and the assets sold during 2015.
Northbridge said its rental activities relating to the energy sector continued to suffer, impacting its revenue from oil tools and loadbanks, on the back of falling demand for exploration and production drilling, and a slowdown in orders for marine fabrication yards.
However, Northbridge said, in contrast, the loadbanks and transformers operating out of Europe had a good year, where the lower cost of oil increased investment in load-testing generators, and transformer rental contracts were extended.
The company said, despite challenges in the markets, it had already taken cost-cutting measures which will benefit 2016 if the downturn is prolonged. It said it was too early into 2016 to predict if a recovery would come this year.
The company will release its preliminary results on April 11.
Elsewhere, the company noted its nominated adviser and joint broker had changed its registered name from Westhouse Securities Ltd to Stockdale Securities Ltd.
Northbridge shares were down 3.1% at 82.38 pence on Thursday.
By Hannah Boland; [email protected]; @Hannaheboland
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