Petrofac reports 'solid' performance ahead of transitional year

Petrofac reported “solid” operational performance in all of its businesses in its full-year results on Tuesday, even as its said its business performance net profit fell 22% to $276m (£213.1m).

The FTSE 250 company said its reported net profit for the year ended 31 December totalled $73m post impairments and exceptional items, rising from $64m year-on-year.

Revenue for the year was $5.53bn, falling from $5.83bn in the 2018 year.

It said its new order intake was $3.2bn for the year, with its backlog standing at $7.4bn as at 31 December, while net cash at year-end stood at $15m.

The board declared a final dividend of 25.3 US cents per share, maintaining its total dividend at 38 cents per share.

“Our results for 2019 reflect solid operational performance across the business and good progress delivering our strategy,” said group chief executive Ayman Asfari.

“Best-in-class execution has delivered attractive margins in our core businesses, underpinned by an unrelenting drive to strengthen our cost competitiveness by investing in talent, local content and digital technology.

“Our migration to a capital light business and tight working capital management has improved cash flow, with agreed non-core divestments set to further strengthen our balance sheet and enhance returns.”

Looking forward, Asfari said the company expected 2020 to be a year of transition.

“We are encouraged by the improving market outlook, recent new awards and $37bn of bid opportunities scheduled for award by the end of 2020.

“Consequently, we are investing in maintaining our bench strength to preserve our market-leading execution capability.

“This investment - together with project mix and the low new order intake of recent years - will impact financial performance in 2020, but best positions us for a return to growth as we rebuild our order book.”

At 0843 GMT, shares in Petrofac were up 0.49% at 360.24p.