Acergy sees short-term risks, forex helps Q4
Posted on 16.03.2009 - 11:00 EDT in GENERAL NEWS by Rons_ROV_Links
Offshore services group Acergy posted a smaller-than-expected 18 percent drop in fourth-quarter operating profit and said it expected more challenges and volatility in the near term, hitting its shares. Earnings before interest and tax fell to $103 million in the September-November period, beating a $94 million average forecast from a Reuters poll of 18 analysts.
Net profit rose to $90 million, above an expected $59 million, boosted by $35 million in currency gains.
"Recent global economic conditions have created a more challenging short-term market and reduced near-term visibility but the medium and long-term fundamentals of our business remain robust," UK-based Acergy said in a statement.
"We therefore expect to see short-term volatility but we remain encouraged by the ongoing discussions with clients in West Africa and other parts of the world."
Acergy designs and builds subsea equipment and pipelines for the oil and gas industry. Along with its sector peers, it has been hit by dropping oil prices, which curb petroleum producers' appetite for investment in new projects.
Its order backlog was down to $2.51 billion on Nov. 30, from $3.04 in August, missing forecasts of $2.76 billion.
Late last year, the company said it expected its core earnings margin to shrink in 2009 and revenues of about $2.6 billion to 2.8 billion this year, against $2.5 billion in 2008.
Analyst Johan Rasting at SEB Enskilda said fourth-quarter order intake had been weaker than expected and that 53 percent of the guided revenue figure for 2009 was covered by the order backlog, from 75 percent of guidance at the same time last year.
Acergy Chief Executive Jean Cahuzac said it was increasingly difficult to give an outlook, but declined to comment on the guidance from November last year.
"It's inappropriate to comment at this stage of the year," Cahuzac told a conference call about the results.
Asked by an analyst if revenue could top 2 billion this year, Cahuzac said that figure "seems to me low."
Cahuzac said he had understood from meetings with oil companies in recent months that large field development projects would go ahead as planned.
"They have to continue to invest to fulfil their objectives," Cahuzac said, adding oil firms would review medium-sized project to optimize cash flow in near term and that they might delay development of marginal fields.
Acergy proposed a 2008 dividend of $0.22 per share, up from $0.21 last year and analyst average forecast of $0.20.