Middle East-based rig maker Lamprell plc expects the challenging environment, which is impacting the industry through project delays and cancellations, to continue through 2017.
As a result, the company expects its order book and next year’s top-line performance to be hampered. Revenue for 2017 is expected to be in the range of $400 to 500 million, depending on the outcome of a number of submitted bids awaiting award, Lamprell said in its first half results statement released Thursday.
Revenue for 2016 expected to be slightly below current market expectations and the company revealed that further cost-reduction activities are being implemented to reflect the reduced revenues.
Lamprell reported a loss of $4.4 million in 1H 2016, compared to a profit of $20.3 million in 1H 2015. Its net cash as at June 30 stood at $151.5 million, which was less than half of the figure reported in the same period last year ($316.3 million).
"The industry downturn has continued to affect the sector and Lamprell's ability to win new contract awards during the period,” said Lamprell Executive Chairman John Kennedy.
"In this tough market environment, Lamprell is in a solid position, both financially and operationally, as a result of our counter-cyclical investment which created a robust base for the group to not only ride out the storm, but also to enable long-term growth,” said Lamprell CEO James Moffat.
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