Weakening Energy Sector a Factor in Fugro Profit Slide

By George Backwell
Thursday, July 10, 2014
Seismic data acquisition: File image

Following a weak first quarter and due to poorer than expected results during the past months, Fugro says it  has decided to disclose preliminary non-audited information on its performance in the first half of 2014. Excerpts as follows:

Fugro expects to report over first half of 2014:

  • Low single digit EBIT margin (excluding non-cash impairments). This compares to an EBIT margin of 11.4% in the same period last year, or 10.3% excluding special items1.
  • Non-cash impairments in a range of EUR 300-350 million.
     

Operational performance issues Q2 2014
After the weak first quarter, improvement in results during the past months has been lower than
expected mainly for the following reasons.

  • The weakening of the oil and gas market, as a result of decelerating growth of capital spending, is resulting in project delays and increased margin pressure in all divisions.
  • The Geoscience division is the single largest contributor to the disappointing performance:
  • Losses in Seabed Geosolutions continued and are larger than anticipated due to underutilisation in the OBN market segment, and some delays on the mobilisation of two large OBC projects.
  • The weakened seismic market is resulting in much lower multi-client sales and consequently will lead to a significantly lower EBIT contribution than in the same period in 2013.
  • The improving trend in the Subsea Services division has been marred by two specific issues.
The first is an engine room fire on the largest vessel in the fleet that resulted in a total of about 7 weeks of non-compensated down time. The second is an ongoing strike of 3 diving crews in Brazil which has had a 4 week impact in the qua

Paul van Riel, CEO commented: 'The development of the results this year so far has been disappointing. During the last quarter it has become increasingly clear that the oil and gas market has weakened. As a consequence we will take impairments on some of our assets. The weakening of the market, in combination with some project execution issues, has impacted our performance. We are taking necessary measures to improve profitability, guided by our 'Growth through Leadership' strategy. We believe that the long term market fundamentals support our strategy, albeit that the expected growth will be somewhat slower than we originally assumed.'

Fugro adds that the first half-year results will be published, as scheduled, on 11, August 2014.
 

Maritime Reporter June 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Panama's Alfonso Castillero Moves to Liberian Registry

The Liberian Registry informs that Alfonso Castillero, former Director-General of the Panama Registry, has joined their organization as Vice-President. Castillero

Bulk Grain Carrier Aground in Lake St. Claire

The Coast Guard informs it is responding to a 36,563 dwt 656-foot freighter that is hard aground in the downbound shipping channel of Lake St. Clair. Coast Guard

Costa Concordia Arrives Genoa for Demolition

Crowley Maritime Corp. subsidiary TITAN Salvage and project partner Micoperi has confirmed that the Costa Concordia – the Concordia-class cruise ship that wrecked off Giglio Island,

Finance

ST Engineering Divest 50% Stake In Beijing Zhonghuan

Singapore Technologies Engineering Ltd (ST Engineering) updated today that further to an earlier announcement made on 28 January 2014, Singapore Technologies

Statoil's 2Q 2014 Results

Statoil's second quarter 2014 net operating income was NOK 32.0 billion, a decrease of NOK 2.3 billion compared to the second quarter of 2013. Adjusted earnings were NOK 32.

Canal Project Slows Panama Economy Growth

Panama's economy expanded in May at its slowest pace since 2009 as major public works projects, including an expansion of the Panama Canal, slowed or wrapped up,

Energy

Mexico's Lower House Pass Energy Reform Bills

Committees in Mexico's lower house on Saturday approved laws fleshing out a landmark energy reform that seeks to drive private investment into the long-shuttered sector.

Exxon eyes expanding Texas refinery

Exxon Mobil Corp is considering a multi-billion-dollar plan to expand its Beaumont, Texas, refinery into the country's largest, the first major refining investment of the U.

Statoil's 2Q 2014 Results

Statoil's second quarter 2014 net operating income was NOK 32.0 billion, a decrease of NOK 2.3 billion compared to the second quarter of 2013. Adjusted earnings were NOK 32.

Seismic Vessel Tech

Rosneft Starts Up Field Work in the Kara Sea

On July 24 this year, research vessel Geolog Dmitry Nalivkin sailed from Kirkenes (Norway) to the Kara Sea. In the next three months 2D seismic survey, will

US Approves Plan to Open Atlantic to Oil Reserve Surveys

The Obama administration on Friday approved a plan that would allow companies to assess oil resources off the Atlantic Coast, angering environmental groups that

 
 
Maritime Careers / Shipboard Positions Maritime Standards Naval Architecture Offshore Oil Port Authority Ship Electronics Ship Repair Ship Simulators Shipbuilding / Vessel Construction Winch
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1596 sec (6 req/sec)