Northbridge's short-term trading visibility challenging

Northbridge Industrial Services warns its short-term trading visibility remains challenging, noting oil and gas industry sentiment and weak activity levels.

The company, whose business model was focused primarily towards rental of equipment, said despite continuing trading losses, EBITDA remained "strongly positive" and that its net debt position would continue to amortise rapidly during 2016 and 2017.

"Whilst short-term trading visibility remains challenging, it is still too early to forecast any material changes to the likely full-year out-turn," the company said in a statement to be presented at its annual meeting.

Its comments were set against a backcloth of industry investment cutbacks, closures and project delays, all of which could impact on Northbridge's trading performance.

"In maintaining the size and scope of our hire fleet, and with substantial reductions in our overhead costs, our operational gearing has increased and our performance will be highly sensitive to modest improvements in revenue," it said.

"We remain optimistic that Northbridge will benefit from this strengthened position when market conditions begin to improve, but we believe this will be unlikely before 2017."