Expro International Pleased with Results
Expro International Group reports that trading during the six months ending September 30, 2005 is in line with expectations and the Board remains comfortable with the current analysts' expectations for the Financial Year 2005/6. Success in securing further significant contracts, detailed below, both underpins current strong market positions, and, through phased delivery over a number of years, provides a highly visible platform for our continued growth.
Key Senior Management Appointments
In order to maintain and further improve our strong customer focus in a dynamic market environment, the Company has evolved its organizational structure to align more closely with the markets it serves. We are therefore pleased to announce three key senior management appointments with immediate effect. Robin Mair will lead the Global Portfolio of businesses, that are largely driven by customer capital spend, consisting of the Tronic/Matre, Subsea Safety Tool ("SST") and Early Production Facility ("EPF") businesses, whilst Gavin Prise will take charge of the mainly opex driven Regional Portfolio consisting of the Cased Hole Services and Well Test businesses. These two internal promotions are complemented by the appointment of Trevor Burgess who joins the Group to champion our emerging Rigless (Enterprise) Technology.
New Contract Wins totaling almost $200m
Within the Regional Portfolio there have been over $100m of contract awards in recent months. This total is a blend of $35m of extensions to existing major contracts, including Well Testing for KPO in Kazakstan and EGIS services for Shell in the North Sea, and $65m of new contracts. The new awards include multi year contracts in Angola for bp (Block 18 and Block 31) and Total (Block 17), establishing critical mass in the key West African area of deep water field development.
The value of currently reportable major contract wins across the global businesses is in excess of $70m, with SST accounting for the majority of this. Indeed new SST contracts for Chevron (Lombito Tomboco and Agbami), Total (Akpo) and Exxon (Erha) further strengthen Expro's presence in West Africa. Tronic continues to enjoy the benefit of increased demand for deep water, hostile environment, power and instrumentation connectors and the successful integration of Matre is nearing completion. The EPF engineered for Exxon's flagship Chayvo Project in Sakalin is now complete and commissioned to plan, and the EPF equipment committed to the recently concluded Tuscan project has been recovered and is currently being bid on several other new projects.
Baker Hughes, our 50% JV partner in QuantX, has recently informed us that they wish to exercise their Call Option to purchase our remaining interest in the business. The option price will be calculated according to a contractually predetermined formula. At this point the transaction is anticipated to complete mid autumn and is not expected to have a material effect on the year-end earnings.
Graeme Coutts, Group CEO commented: "I am very pleased to announce the further progress Expro is making, evidenced by the evolution of the organizational structure and almost $200m of new contract wins, bringing the total value of contracts announced in the current year to $400m.
Our core business continues to perform in line with expectations allowing us to progress with our key investment strategies. It has come as no surprise to the Board that our JV partner Baker Hughes should choose to exercise their right to acquire our 50% stake in the QuantX business. QuantX has always provided a better fit for their core activities due to the associated product pull-through."
Expro will be announcing its Interim Results for the half year ended September 30, 2005 on Thursday 24 November 2005.
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