13th Jan 2010 07:00
13 January 2010
KBC Advanced Technologies plc
("KBC" or "the Group")
Pre-Close Trading Update
As indicated in our statement of 15 December 2009, results for the year to 31 December 2009 are expected to be in line with market expectations.
Contract awards for 2009 were more than £55m, up 7% on 2008, and the consequent workload backlog at the year end is expected to be more than £40m - an increase on both the prior year's closing backlog of £39m and the £35m at 30 June 2009.
The Group's net cash position is expected to be around £4m at the year end, more than double the position at 30 June 2009. The net cash position at 31 December 2008 was £5.6m.
The last quarter of 2009 saw strong software sales awards, in common with prior years. The sale to Petrobras that was announced in December was the largest, with other significant sales to Sinopec in China, to TNK-BP in Russia and Qatar Petroleum and licence renewals with Repsol in Europe and South America. Petro-SIM™ has now been sold to more than 170 sites.
Consultant utilisation improved during the last quarter as the work in Vietnam and Ecuador that was announced last year got under way, together with other ongoing work on various capital projects in the Middle East, Korea and South Africa. Work from core clients in the process improvement area has also been maintained with good examples being Irving Oil in Canada, Petronas in Malaysia and work with a strong energy focus with Petro-China. However, the improvement in this area was slower than anticipated, particularly in the human capital area. New awards in December including a large contract with Takreer in Abu Dhabi, mean that this has started to change in January.
The Refining industry remains in transition, with investment and expansion continuing in the developing world and overcapacity and margin pressure in the developed world leading to contraction. Whilst this environment creates opportunities for KBC, there remains significant uncertainty and more competition as the larger engineering contractors are less busy. In view of this, forecasting the timing of new business remains difficult. We start 2010 with a higher backlog and a lower cost base than 2009 and with an enhanced suite of services and products. Collectively these provide the business with the flexibility to succeed in the current market environment. As a result, we look forward to a continuation of the gradual improvement in trading we have seen during the second half of 2009.
-Ends-
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KBC Advanced Technologies plc |
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George Bright, Chief Executive Nicholas Stone, Operations and Finance Director |
01932 236314 |
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Weber Shandwick Financial |
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Nick Oborne/Clare Thomas |
020 7067 0700 |
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Arbuthnot Securities |
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James Steel/Antonio Bossi |
020 7012 2000 |
About KBC:
For 30 years KBC's consultants have provided independent strategic and engineering expertise to enable leading companies in the global energy business and other process industries to manage risk while maximising value from their assets. In times of economic uncertainty and increasing environmental pressure, KBC's proprietary methodologies and innovative tools guide its clients' key strategic decisions, enabling them to prioritise and implement initiatives that maximise return on investment, and improve operational performance. KBC offers Strategic and Market, Capital Investment, Operating, Organisational, and Environmental Solutions. For more information, visit www.kbcat.com
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