PROFITS AT Irish-Malaysian engineering and instrumentation group Kentz grew almost 19 per cent to €31 million in its first full year as a quoted company.
Kentz floated on London’s Alternative Investment Market (AIM) in February 2008. The group provides services to the oil exploration and production industries as well as to sectors such as mining and pharmaceuticals.
The company reported yesterday that profit before tax grew 18.7 per cent in 2008 to $40.7 million (€31 million) from £34.3 million the previous year.
Revenues grew in line with this to $643.4 million last year from $544.6 million in 2007. Cash balances grew almost 25 per cent to $154.4 million at the end of 2008 from $123.7 million a year earlier.
Earnings per share were up 10 per cent at 25.09 cent. The company is proposing to pay shareholders a dividend of 3.8 cent a share.
The group’s backlog of orders stood at $1 billion at the end of January, its highest ever level. At the same time, it had letters of intent for contracts worth a further $200 million.
Kentz expects to complete contracts worth $520 million – out of the $1 billion total – this year, and the balance in following years.
A sharp fall in oil prices from a high of $148 a barrel to around $50 sparked fears that exploration, and consequently production, would slow.
However, chief executive Hugh O'Donnell told The Irish Timesyesterday that the company has not seen any evidence of this and pointed out that its order book remains strong.
The company’s statement says that many oil companies boosted their exploration and production spending to record levels last year, and adds that their plans for 2009 vary considerably.
“We are seeing positive capital investment sentiments for upstream exploration and production projects from important Kentz clients, such as Shell, ExxonMobil, Chevron, BP, Abu Dhabi National Oil Company and Saudi Aramco,” the statement said.
“We remain comparatively well insulated against the decline in oil prices as our key regional market, the Middle East, has production costs that are amongst the lowest in the world. As a result, whilst there have been some delays to projects, there have been very few projects cancelled.”
The group also says that it is seeing growth in demand for liquid natural gas plants.
Tipperary-based Kentz designs and supplies control systems for plants involved in oil and gas refining and chemical and pharmaceutical production. It provides these services under contract to its clients.
