Norwegian oilfield services company Aker Solutions has provided a somewhat positive outlook for the next year and a half.
Presenting its second quarter results, Aker Solutions said that the markets are challenging and projects are being postponed across the industry. However, with cost cuts driving down break-even costs, some major developments might be sanctioned in the next 12-18 months, the company said.
While offshore Norway is largely expected to remain subdued, there are signs that the region may start to see a gradual recovery from 2017, the company said.
The order backlog was NOK 35 billion at the end of the quarter, of which almost two-thirds were for projects outside Norway.
“Aker Solutions’ greatest growth potential is outside of Norway, where the company has been expanding. Tendering activity remains steady and totals about NOK 35 billion,” Aker Solutions said.
That Aker Solutions is indeed doing business outside of Norway speaks the fact that the company during the second quarter won NOK 3.4 billion in orders, including a contract of more than NOK 1 billion to deliver its longest-ever umbilicals system at the Zohr gas field offshore Egypt and an order from Idemitsu Oil and Gas for front end engineering design at the Sao Vang and Dai Nguyet developments offshore Vietnam.
The company’s revenue fell to 7 billion Norwegian crowns in the quarter from 8 billion crowns a year earlier as the oil-services market slowed and some projects neared completion. Earnings before interest and taxes (EBIT) were NOK 319 million compared with NOK 376 million a year earlier. The EBIT margin was 4.6 percent versus 4.7 percent a year earlier.
Offshore Energy Today Staff