Shares in Cape (CIU) surged on the release of full-year figures that seemed to vindicate the oil service provider's commercial strategy. Over the past few years Cape has rejigged its business mix in favour of maintenance contracts. Now, with oil and gas capital budgets in retreat, that bias is beginning to pay off. Cape's adjusted operating profits were up 28 per cent at £52.1m on a margin of 7.5 per cent - 150 basis point higher than in 2013.
Revenues were driven by a good performance from the group's Asia Pacific business as well as the Motherwell Bridge engineering acquisition, which resulted in a 4.1 per cent boost to the top line. At £765m, order intake was up by over a fifth, helped along by a £150m renewal contract for maintenance work at EDF in the UK.
Market conditions were mixed across the group's geographic regions, but Cape continues to benefit from more predictable receipts from state-owned oil companies in the Middle East and Asia. After the year-end, Cape was also awarded contracts worth around $65m (£44m) for services linked to the development of the Shah Deniz field, a major natural gas project in Azerbaijan.
JPMorgan Cazenove expects adjusted EPS of 27.1p in 2015, with cash profits of £68m.
| CAPE (CIU) | ||||
|---|---|---|---|---|
| ORD PRICE: | 243p | MARKET VALUE: | £295m | |
| TOUCH: | 243-247p | 12-MONTH HIGH: | 330p | LOW: 177p |
| DIVIDEND YIELD: | 5.8% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 103p* | NET DEBT: | 79% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 650 | 63.1 | 43.0 | 12 |
| 2011 | 698 | 61.9 | 40.0 | 14 |
| 2012 (restated) | 737 | -143 | -137 | 14 |
| 2013 | 675 | 0.4 | -1.5 | 14 |
| 2014 | 698 | 29.8 | 18.6 | 14 |
| % change | +3 | +7350 | - | - |
Ex-div: 21 May Payment: 23 Jun *Includes intangible assets of £148m, or 122p a share | ||||
