LONDON (Alliance News) - Cape PLC Wednesday maintained its interim dividend after its pretax profit experienced a small lift in the first half of 2015 and said it performed well in all areas apart from Asia.
The provider of industrial services to the energy and natural resource sectors said it expects to meet full year expectations but warned current market volatility continues to provide uncertainty for 2016.
The company reported a GBP17.4 million pretax profit in the first half ended July 5, rising from GBP16.7 million a year earlier as revenue experienced a lift to GBP362.6 million from GBP320.3 million. Before exceptional items, pretax profit totalled GBP21.2 million, which was still up from GBP20.2 million. Earnings before interest, tax, depreciation, amortisation and exceptional items rose to GBP32.8 million from GBP29.9 million.
Cape decided to keep its interim dividend flat from a year earlier at 4.5 pence per share.
"I am pleased to report results for the first half of the year in line with expectation. Our balanced business and drive for operational excellence has enabled us to achieve a robust performance against a backdrop of mixed market conditions. We anticipate that we will deliver a full year performance in line with expectation and believe that our strategy leaves us well placed to capitalise on the opportunities we see ahead of us," said Chief Executive Joe Oatley.
Cape's order intake during the first half increased by 26% to GBP399.0 million from GBP317.0 million, and at the end of June its order book stood at GBP800.0 million, compared to GBP643.0 million at the end of June 2014 and GBP746.0 million at the end of December 2014.
Operationally, the company performed in line with expectations in the UK, Europe and in the Commonwealth of Independent States, which is comprised of Azerbaijan, Armenia, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Uzbekistan and Ukraine.
In the Middle East and North Africa, Cape said it performed "ahead of expectation" after it managed to achieve a stronger operating margin of 16.8% across the region compared to 13% a year earlier.
However, its performance in Asia Pacific was below expectations due to lower than anticipated sales volumes and"aggressive pricing" in the Australian market, it said.
"Given the current order book cover for the remainder of 2015, the board anticipates that the full year performance will be in line with expectation," said the company.
"The current market volatility continues to give uncertainty to the outcome of 2016; however, the board expects that demand is likely to be similar to the current year with mixed market conditions in the UK, and weakness in Asia Pacific offset by robust demand in Azerbaijan and the MENA region," it added.
Cape shares were up 1.4% to 216.0 pence per share on Wednesday morning.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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