Aker Provides Oilfield Services Cheer with Upbeat Results
Norway's Aker Solutions provided some cheer for the oilfield services sector Friday when it announced upbeat fourth quarter results.
Aker generated sales of $1.2 billion during 4Q 2014, up from $975 million in 4Q 2013. Earnings before interest and taxes for the quarter were also greater at $72.4 million (4Q 2013: $63.2 million).
The firm also boosted its order intake by $806 million during the quarter, bringing its total order backlog at the end of December to $6.3 billion (Dec. 31, 2013: $5.4 billion).
Like fellow oilfield services firms Baker Hughes and Halliburton, which announced thousands of layoffs in January, Aker has also had to make cutbacks in its workforce – particularly in Norway where it announced last summer that a couple of hundred jobs were at risk amid a slowdown in the country's offshore maintenance and modifications market. But the firm believes its strong order backlog will stand it in good stead in spite of the lower oil price forcing many operators to cancel and delay projects.
"Our robust order backlog puts us in a strong position as we face market uncertainty caused by the recent oil price drop," Aker CEO Luis Araujo said in a company statement.
"We made good progress in the quarter on major subsea and engineering projects and also benefited from improvement programs across the business."
In its 4Q 2014 results statement the company elaborated further, pointing out that the underlying factors that support a positive long-term outlook for offshore and deepwater oil and gas developments remain in place.
While Aker noted that major western oil companies are expected to continue to exercise capital and cost discipline over the next couple of years and that there is a risk that projects will continue to be postponed, the firm "is primed in the long term to take advantage of the shirt toward more complex offshore resources".
Aker added that it still expects to grow with its key markets and "at least maintain market share" in our core subsea, engineering and MMO businesses.
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