Oilfield services firm Subsea 7 reported Friday that it increased its first quarter net income by 151 percent compared to the first three months of 2011 to $93 million. The profit was made on the back of a 35.5 percent improvement in revenue to $1.5 billion during the period.
Subsea 7 said that it expects 2012 to be a year of progress for the firm, although it will also be a transition year in Africa due to project timings with it foreseeing a high number of planned dry-docks throughout the year.
In West Africa, the firm expects to move through a period of lower offshore activity in the second half of 2012 on those projects awarded over the past 18 months. Subsea 7 also expects a number of major SURF (subsea umbilicals, risers and flowlines) contracts to be awarded in the coming months.
Given the longer duration of these projects, Subsea 7 said that offshore execution should be expected to be in late 2013 and predominantly 2014.
In the North and Norwegian Seas, levels of tendering remain very strong with improved pricing for those new projects that will be offshore in 2012 and beyond, added the firm. It expects to see an improving level of activity in 2012 and improved margins year-on-year reflecting the execution of projects awarded in improving market conditions, together with the completion of most of the remaining lower margin projects awarded to the firm in 2010.
Meanwhile, in the Gulf of Mexico Subsea 7 sees some increase of activity with contract awards to the market in 2012 with execution in late 2013 and 2014 in a market where pricing conditions remain challenging.
"I am pleased with our results. We have delivered a good first quarter in line with our expectations. We have also continued to improve the quality of our backlog. These results confirm the momentum that we see in most of our markets as our clients remain very positive with ambitious investment plans," said Subsea 7 Chief Executive Officer Jean Cahuzac in a statement.
"Our priorities for 2012 have not changed. We remain focused on project execution and disciplined in targeting opportunities that play to our strengths with appropriate margins and returns."
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