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Petrofac reported revenues of $2.8bn in the first half, up 1.3% year-on-year. However, an increase in less profitable contracts, cost overruns and higher taxes dented margins, with net profits down 19.4% at $154m.
The board announced an interim dividend of 12.7 cents per share, in line with last year.
The Engineering & Construction (E&C) business saw revenues rise 2% to $2.3bn and net profits fall 16% to $148m. The division won $1.6bn of new contracts during the period including projects in Algeria, Oman and the Netherlands.
Engineering & Production Services (EPS) delivered revenues of $0.4bn in the half, up 4%, with net profits of $23m down 15%. The business won $0.4bn worth of new contracts.
Integrated Energy Services (IES) revenues fell 27% to $99m - although that was driven by disposals, without which revenue would have risen 5%. The underlying growth reflects higher average realised prices and increased production. Reported net profits fell 56% to $7m, although excluding the effect of asset disposals that would represent 147% growth.
The total value of the order book fell from $9.6bn at the start of the year to $8.6bn at the end of the first half. E&C and EPS both saw total back log decline. The group is pitching on $13bn of opportunities in the second half.
The group finished the half with net cash of $69m.
Margins in the key E&C division are now expected to be at the lower end of guidance for the year as a whole, with lower overall profitability in the second half. Revenues are expected to decline in 2020, reflecting the lower order intake in recent years.
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