(Alliance News) - Petrofac Ltd on Wednesday said its trading is in line with expectations for 2020 despite a difficult environment caused by the Covid-19 pandemic.
The oilfield services company based in Jersey said it expects a group revenue of approximately USD4.0 billion and full-year profitability to be materially lower year-on-year. This is due to lower oil prices and an uncertain near-term outlook resulting in delays in awarding new projects across the industry, it said.
However, the company remains on track to reduce gross overhead and project support costs by at least USD125 million in 2020.
Looking ahead, Petrofac said a low order intake over recent years will result in a decline in revenue in 2021. To combat this, it has announced a set of measures designed to make a total estimated gross savings of USD250 million next year, which will seek to protect the business from lower revenues and ongoing pressures on margins, it said.
Group Chief Executive Ayman Asfari said: "The Covid-19 pandemic and collapse in oil prices have had a material impact on our industry in 2020. We have also taken decisive action to protect our balance sheet, liquidity and the long-term health of the business. All these actions have protected margins and cash flow, and the group is trading in line with expectations as we approach the year end."
Asfari announced his retirement in October and will be appointed as a non-executive director at the start of 2021. He was replaced by former Royal Dutch Shell PLC executive Sami Iskander, who joined as deputy CEO in November and will become group CEO from January 1 when Asfari leaves the role.
Shares in Petrofac were down 4.3% at 165.46 pence in London on Wednesday.
By Zoe Wickens; zoewickens@alliancenews.com
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Petrofac (PFC)