Sagging oil and gas capital budgets continue to weigh on the financial performance of Lamprell (LAM), a provider of engineering and contracting services to the industry. Revenues were slightly adrift of guidance, and cash margins fell to 10.3 per cent from 12.6 per cent in 2014, although management maintains that the prior year comparative was "exceptional". Lamprell continued to drive cost efficiencies throughout 2015, but pricing pressures fed through into a 45 per cent reduction in net earnings to $64.7m (£45.6m).
The order backlog, the bulk of which is attributable to the current year, fell 38 per cent to $740m. The group actually recorded a year-on-year increase in the bid pipeline, but management admits delays and deferrals on projects will invariably impact the conversion rate for new business contracts.
Prior to these figures, Investec gave adjusted profits of $60.2m and EPS of 17.6¢ in 2016, rising to $64.9m and 19¢ in 2017.
| LAMPRELL (LAM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 84.75p | MARKET VALUE: | £290m | |
| TOUCH: | 85-86.25p | 12-MONTHHIGH: | 167p | LOW: 63p |
| DIVIDEND YIELD: | nil | PE RATIO: | 6 | |
| NET ASSET VALUE: | 216¢* | NET CASH: | $201m | |
| Year to 31 Dec | Turnover ($bn) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2011 | 1.20 | 64.0 | 27.0 | 8.0 |
| 2012 | 1.00 | -115 | -43.0 | nil |
| 2013 | 1.07 | 37.8 | 12.7 | nil |
| 2014 | 1.08 | 93.7 | 29.5 | nil |
| 2015 | 0.87 | 67.0 | 19.5 | nil |
| % change | -20 | -28 | -34 | - |
£1=$1.42 *Includes intangible assets of $206m, or 60¢ a share | ||||
