(Alliance News) - Hunting PLC on Wednesday said its first-quarter results were "marginally ahead of management's expectations", shaking off a "soft" US onshore market.
The London-based maker of parts and technology systems for the oil and gas sector expects to report earnings before interest, tax, depreciation and amortisation of USD28.9 million for the first quarter of 2024, a 29% increase from the USD22.4 million reported at the same time last year.
Hunting maintained its full-year Ebitda guidance of USD125 million to USD135 million, at best a 31% rise from USD103.0 million.
Revenue for the first quarter of 2024 increased year-on-year by 16% to USD244.9 million from USD211.5 million.
The sales order book increased 10% compared to the first quarter of 2023 to USD544.0 million from USD492.9 million.
"Orders for titanium and steel stress joints, hydraulic valves and couplings and flow access modules have increased, given the strong offshore drilling environment," Hunting said.
However, the company said the onshore US market has been "less resilient" in comparison, hurt by "low activity and soft pricing for natural gas". Activity levels are expected to improve in the second half of the year as a new liquified natural gas capacity becomes available, which will support higher volumes of exports.
Hunting Chief Executive Officer said: "The year has started positively for the group, with first quarter results for 2024 marginally ahead of management's expectations and well ahead of the first quarter result for 2023, which demonstrates the continued growth momentum of the group. Our oil country tubular goods subsea and advanced manufacturing product groups are continuing to see strong momentum as offshore and international activity remains robust. While perforating systems has had a slow start to the year, the second half of 2024 is likely to see stronger activity as increased liquified natural gas exports in the US drive natural gas demands.
"It is particularly pleasing to see our first quarter Ebitda result surpassing the fourth quarter of 2023 result, given the strong result delivered in the prior quarter, with subsea being our standout performer this quarter. 2024 is likely to be a further year of growth for the industry, driven by geopolitical and macroeconomic factors. Therefore, management remains confident of delivering its current Ebitda guidance, given the broad-based strength of the global oil and gas sector."
Hunting shares were down 2.5% to 349.00 pence each in London on Wednesday morning.
As announced previously, Stuart Brightman will be taking over the role of chair from Jay Glick after the firm's annual general meeting concludes on Wednesday.
Hunting's next trading statement will be released on July 8.
By Emily Parsons, Alliance News reporter
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Hunting (HTG)