Shares in Lamprell (LAM) have barely looked back since the troubled oil rig engineer revealed cost-cutting measures and booked the cost settlement with contractor Ensco in its half-year results in September. However, that is little reflection of trading activity, which remains challenged.
The one bright spot in a predictably terrible set of full-year accounts was the balance sheet - clearly a focus of new chief executive Chris McDonald - which showed a 31 per cent rise in year-end net cash to $275m (£220m). Otherwise, 2016 figures were rough. Cash profit margins more than halved, meaning post-tax profit was only essentially at the break-even level, even before exceptional items. Unfortunately, these came in at $184m, mostly owing to a goodwill impairment of the Maritime Industrial Services acquisition from 2011.
While much of this has been baked into the stock's current valuation, there are scant signs of a turnaround. Full-year revenues in 2017 are expected to be "in the lower half of the $400m-$500m range in the absence of large project deliveries". And with the bid pipeline now down to just $2.5bn, the pivot into other areas - such as a joint venture with the Saudi Maritime Complex - should not surprise.
Analysts at Canaccord Genuity expect an adjusted loss before interest and taxes of $11.8m in 2017, giving a loss per share of 4.6¢ (from $45m and 12.2¢ in 2016).
LAMPRELL (LAM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 100p | MARKET VALUE: | £343m | |
| TOUCH: | 100-101p | 12-MONTH HIGH: | 119p | LOW: 55p |
| DIVIDEND YIELD: | NIL | PE RATIO: | NA | |
| NET ASSET VALUE: | 163¢ | NET CASH: | $275m | |
| Year to 31 Dec | Turnover ($bn) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2012 | 1.00 | -115.0 | -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 |
| 2016 | 0.70 | -182 | -53.3 | nil |
| % change | -19 | - | - | - |
Ex-div: na Payment: na £1=$1.25 | ||||
