Hunting says Covid-19 reduces demand, pulls guidance

In a statement before its annual meeting, Hunting said trading in the three months to the end of March was broadly in line with its expectations but that the coronavirus pandemic had a greater effect since then as customers cut spending in response to the plunging price of oil.

Hunting said the impact of the crisis since the middle of March made it difficult to judge how its business would be affected. As a result the company withdrew its financial guidance for the year to the end of December 2020.

"The impact of the oil price decline has affected demand within the group's segments focused on US onshore completions since the end of March 2020," Hunting said. "Other segments are likely to see declines towards the end of Q2 2020, given that orders are continuing to be completed across all of Hunting's operating regions for a variety of offshore and international projects."

Hunting said its net cash position at the end of March was $22.3m (£17.8m) – down from $123.1m at the end of December. The reduction of more than $100m was caused by $33m paid to buy Enpro Subsea, $11m for share buybacks and employee share awards and other items, including payment settlements, of $56.8m.

An interim dividend payable on 15 May will cost a further $5m, Hunting said. The company scrapped its final dividend of 6 cents a share on 3 April and replaced it with a 3 cents a share interim payout. Hunting also embarked on the first share buyback in its history in February as fears grew about the widening impact of the Covid-19 outbreak.

Despite the cash depletion the company said it had a "robust" balance sheet and good liquidity including $160m of undrawn bank facilities in place until 2022.

Hunting shares fell 6.6% to 179.81p at 11:19 BST. The shares have more than halved from 406.6p at the beginning of 2020.