Shares in Petrofac tumbled again this morning as the energy services company continues to review its strategic and financial operations. A note published this morning highlighted the prospect of a debt to equity swap or a fresh capital raise, two options that would both leave investors diluted, although would help the business address its $8bn order backlog. The market however was taking the glass half empty view, with shares off by some 30% in early trade.
We reported a few days ago that the company’s CEO had failed to declare some reportable transactions regarding his own shareholding in the company. That lead to the publication of a note headlined “Director's Share Dealings” despite it also carrying the more important line that the CEO had been suspended. Today we read of a “Directorate Change” that advises the market that the CEO has now tendered his resignation, this has been accepted and the stock is up by more than 10% in the first hour of trade.
R&Q this morning provided an update on trading and the sale of certain divisions of the business. The key line in the note appears to be the head-up that they will realise a significant pre-tax loss for the year owing to adverse developments in R&Q Legacy, plus a material increase in corporate costs relating to the sale of Accredited. With the stock down by some 45% at 9am, the market is finding little to cheer, here.
Headlines we expect on Monday
Itaconix Final Results
This time last year Revenue $5.6m, Gross profit margin 26.6%, cash at year end $567,000
Ceres Power Final Results
This time last year Revenue £22.1m, Gross profit £13.1m, cash position £182.3m
