Last checked at 10 Apr 2024 07:00
Enteq Technologies plc
("Enteq" or the "Company")
Year-end Trading Update
Enteq Technologies plc (AIM: NTQ.L) the specialist energy services engineering and technology company is pleased to provide a trading update for the financial year ended 31 March 2024 and an update on the progress of the SABER Tool (Steer-At-Bit Enteq Rotary) technology.
Trading update:
Trading reflects the Company's strategy to focus on SABER development and commercialisation, whilst maintaining a lean overhead base.
The cash balance as at 31 March 2024 was $3.0m ($5.3m at 31 March 2023, and $5.1m at 30 September 2023). The movement in cash during the financial year reflects continuing investment in SABER, and the steps taken towards full commercialisation of the tool.
Revenue for the full year ended 31 March 2024 will be in the region of $0.9m representing the final revenue following the sale of the XXT business. The adjusted EBITDA1 loss for the year is expected to be approximately $2.9m compared to the equivalent loss of $1.6m in the first half of the year. The EBITDA result reflects the discipline on lean overhead management while maximising liquidity for the SABER commercialisation.
SABER update:
The SABER Tool and personnel are currently on-location in a live drilling environment with the customer in Australia as part of a structured customer test programme, expected to then progress to active commercial operations.
The downhole active drilling programme, performed at the Catoosa, USA test site in February 2024, has again successfully proved the steering ability of the SABER Tool, with this phase of testing proving additional technical capabilities of the tool. Potential customers and strategic partners have reviewed the results of the testing from Catoosa, which has led to ongoing commercial discussions with these selected industry parties.
The build-programme for the further fleet of equipment is progressing as planned, with the major items now in stock at the Houston facility. Additional incremental performance and production improvements have been implemented and tested.
Andrew Law, CEO of Enteq Technologies plc, commented:
"We are pleased with the technical and commercial progress that has been made. Following the recent Catoosa testing, it has been encouraging to see good levels of engagement with potential strategic partners and customers in the industry."
For further information, please contact:
Enteq Technologies plc +44 (0)20 8087 2202
www.enteq.com
Andrew Law, Chief Executive Officer
Mark Ritchie, Chief Financial Officer
Cavendish Capital Markets Limited (NOMAD and Broker) +44 (0)20 7220 0500
Ed Frisby, George Lawson (Corporate Finance)
Andrew Burdis (ECM)
The financial information for FY24 included in this announcement is unaudited.
1Adjusted EBITDA is reported loss before tax adjusted for interest, depreciation, amortisation, foreign exchange movements, performance share plan charges and exceptional items.
About SABER:
Enteq has a track record of developing and commercialising technical equipment in a drilling environment for oil, gas, geothermal and now also energy transition. SABER commercialisation is the primary focus for the Company and provides a novel approach to steering the bit while drilling the well; it is an alternative to existing Rotary Steerable Systems (RSS).
The SABER Tool is based on a concept originally developed by Shell, where rather than using pads or pistons to create steering forces, the SABER Tool uses an internally directed fluid pressure differential system. By removing these external contact points, the SABER Tool achieves true at-bit steering for the first time and the mechanically simple design gives the potential to improve reliability and project uptime versus conventional RSS solutions.
Enteq has the exclusive global license for this novel rotary steerable technology and IP from Shell. Enteq has developed and refined the concept, generating additional protected IP. Following successful field testing, the SABER Tool is now commencing customer testing, and is being readied for commercial deployment.
The global RSS market is worth approximately US$3.6 billion annually according to a recent 2023 report from Spears. The SABER Tool has the potential to drive operational efficiency across the world's directional drilling applications, including hydrocarbon production, geothermal energy, methane capture and CCS (carbon capture and storage). Enteq will provide the SABER Tool to customers through a service arrangement or equipment purchase, providing independent and regional directional drilling companies more opportunity to compete with major integrated service companies which have to date dominated this segment.
The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.