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LONDON (Alliance News) - Capital Drilling Ltd Tuesday said it swung to a pretax loss in its full-year 2013 and revenues fell as the company expected following a significant decline in demand.
The emerging and developing markets drilling company said it swung to a pretax loss of USD1.9 million as compared from a pretax profit of USD18.9 million the previous year as revenues fell 27% to USD116.3 million from USD158.9 million in 2012.
The company said in January that it expected the 27% fall in revenues due to a significant decline in fleet utilisation as a number of clients reduced their drilling requirements, mainly in the second-half of the year.
During the period, Capital Drilling conducted a cost reduction programme due to the drop in demand for its products, reducing its employees by around 500 during the year to 834 members of staff and reducing its infrastructure in a number of countries, particularly in Latin America.
The company said on Tuesday that its cost of sales fell 19% to USD85.7 million during the period from USD105.9 million the previous year and its administrative expenses fell 14% to USD13.6 million from USD15.9 million in 2012.
Capital Drilling said in January that despite the poor results, it remains in robust financial and operational shape. It said the worsening in market conditions has been more moderate so far in 2014 than in 2013.
The company said on Tuesday that it has seen a recent increase in tender enquiries but the trading environment remains challenging.
Capital Drilling shares were down 1.2% to 29.90 pence Tuesday.
By Tom McIvor; tommcivor@alliancenews.com; @TomMcIvor1
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