Lamprell's (LAM) share price performance has been somewhat erratic over the past five years. That won't come as a surprise to many of our readers, who will recall that the oil rig constructor issued five profit warnings in the space of seven months during 2012.
The group has hardly been operating under favourable market conditions since crude oil prices clicked into reverse midway through 2014. That is a point borne out by a 20 per cent fall in its annual pre-tax profits and a sharp contraction in the cash margin.
Suddenly, matters are looking far more favourable. UAE-based Lamprell has entered into a joint venture with Saudi Aramco and Hyundai Heavy Industries to invest in a highly anticipated $5.2bn (£4bn) maritime 'super-yard' in the Kingdom. The deal involves the supply of 20 jack-up rigs to the state-controlled oil behemoth over a period of 10 years, in addition to the provision of maintenance, repair and overhaul services. When fully operational in 2022, the yard will boast the largest production capacity in the Arabian Gulf.
