Petrofac predicts modest growth for the year

New orders in Abu Dhabi, Iraq and Oman helped to expand the value of its order book by 27 per cent last year compared to 2012’s $11.8 billion, and so far this year the company has taken in about $3bn in new contracts.

Petrofac’s order backlog swelled to a record high of US$15 billion last year, but the oil services provider has told investors to expect “modest to flat growth” in profits.

New orders in Abu Dhabi, Iraq and Oman helped to expand the value of its order book by 27 per cent last year compared to 2012’s $11.8bn, and so far this year the company has taken in about $3bn in new contracts, the London-listed company reported yesterday.

Profits grew by 3 per cent to $650 million, beating a Reuters poll of analyst estimates, while revenues ticked up 1 per cent to $6.3bn.

“Having delivered modest earnings growth and good operational performance in 2013, we begin 2014 in an encouraging position with record backlog, a project portfolio in excellent shape, a strong bidding pipeline and US$3bn of new awards already secured in the year to date,” said Ayman Asfari, Petrofac’s group chief executive. “In line with our previous guidance, we expect flat to modest growth in net profit in 2014 and remain confident of a return to strong earnings growth in 2015.”

Shares of Petrofac dipped 1.76 per cent to £1.34 on the London bourse after the announcement.

Last year’s new orders in the UAE, where Petrofac has core operations in Abu Dhabi and Sharjah, included a $500m engineering and construction contract for the Satah Al Rasboot field offshore, one of Abu Dhabi National Oil Company’s first sole-risk projects without a foreign investor.

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