Pre-Close Trading Update
Expro International Group PLC
25 September 2007
25 September 2007
EXPRO INTERNATIONAL GROUP PLC
Expro Announces Pre-Close Trading Update, Over USD 300 million of Contract Wins
and Three Industry Firsts.
Expro International Group PLC ("Expro" or the "Group") announces today that
trading during the six months ending 30 September 2007 has seen a continuation
of the positive growth momentum established in prior periods.
Market conditions for late cycle upstream oil and gas services have remained
strong throughout the period. The effects of sustained global economic growth
projections interacting with ever increasing supply challenges have created a
new platform for oil and gas commodity prices. This platform is now well
established above USD 60 per bbl and provides a positive backdrop for Expro to
execute focused growth strategies aimed at helping our customers meet their
extensive operational challenges.
New contract wins totalling over USD 300 million
Expro today announces over USD 300 million in new contract awards in the first
six months. The awards have been delivered by our worldwide operations, across a
comprehensive range of products and services, for delivery on a phased basis
over the next three years. Significant awards include:
Eastern hemisphere
New contracts totalling USD 40 million were secured in the North Sea. The
increasingly service intensive UK sector was particularly active; now a late
cycle province, where progressively smaller accumulations of hydrocarbons are
connected, via subsea tie-back techniques, to the aging but comprehensive
infrastructure. Awards from smaller but highly active operators including
Perenco, Oilexeco and Venture Production are evidence of the ever changing
characteristics of the UK North Sea and play heavily to Expro's strength in this
key technology segment. Our European business is also responsible for progress in
the markets of the Former Soviet Union. In this area further progress was made in
the Kazakhstan market with Ada oil and Agip ENI. The latter included an extension
of our scope on the KPO contract.
Over USD 20 million of new orders were secured in North Africa and the
Middle-East during the period, building on the previously announced major
contract from Saudi Aramco in Saudi-Arabia. Multi service contracts were won
with BP and BG in Algeria, Woodside and BG in Libya together with multiple
welltesting contracts in Egypt.
Expro's investments in deepwater technology had a very positive effect on
progress in the offshore markets of West and South Africa. In total over USD 60
million of new awards were secured in the period. These markets are dominated by
major international oil and gas operators as they seek to add reserves and
production in these technically differentiated markets. Awards from Chevron,
Agip ENI and Shell in Nigeria, increased scope from BP deepwater Angola, CNRL
offshore Ivory Coast, Total and Noble in the Cameroon, Addax in Gabon and
PetroSA for services offshore South Africa show the depth of Expro's presence in
these technology critical markets.
In the combined markets of Asia new contracts to the value of USD 15 million
were secured in the period. Contracts included Cairn Energy and BG in India,
Santos and Apache in Australia and Amerada Hess in Thailand.
Western hemisphere
A further USD 30 million of new contracts were secured in the deepwater Gulf of
Mexico. This market is highly appreciative of Expro's service quality and
technology. In the period awards from Shell on their Mensa and Ursa assets, BHP
on Shenzi and Genghis and ENI/Dominion on the Pegasus project were the most
notable. The markets of the United States are pre-dominantly short term call-off
in nature but the rise in the deepwater activity and subsequent tight supply in
specialised equipment requires our customers to increase their planning cycle.
This has resulted in better visibility in the offshore segment.
In Latin America where Expro has recently increased its presence, a total of
over USD 30 million of new contract awards were secured in the period. Brazil
was the single most active country with over USD 10 million of new business from
Petrobras, Repsol and ENI. The Brazilian market is particularly active as Petrobras
prepares to significantly increase offshore exploration and development activity
levels out to 2010 and beyond. Mexico and Venezuela have also been active in the
period. In the former Expro has been awarded a contract to support Pemex valued
at USD 12 million to provide welltesting equipment on a purpose built test vessel.
New business awards in Venezuela have held up well throughout a period of uncertainty
in this market, with Expro securing new contracts with PDVSA and BP.
In addition to our international Regional infrastructure activities, our
Connectors and Measurements business which supplies the global subsea markets
from two centralised factories in Cumbria (UK) and Bomloe (Norway), continued to
progress. Confirmed order backlog is currently USD 45 million. This is a leading
measure of upcoming performance and is progressing in line with our expectations
of expanding deepwater and subsea markets.
Industry firsts
As our customers search for and develop increasingly difficult hydrocarbon
prospects in deep water provinces, Expro is at the forefront of providing
critical high reliability technologies and outstanding service quality. During
the first half of 2007/08, Expro achieved three industry firsts in this area,
providing our international customer base with new standards in technology
achievement and quality.
Expro set a new deepwater record for North African exploration welltesting on
the NEMED prospect, in over 7500 feet of water, for Shell offshore Egypt. This
achievement follows the overall deepest water well ever tested offshore Brazil
in 8993 feet performed by Expro last year.
In addition, operations on the first ever high pressure/high temperature subsea
development commenced in the Tahiti field for Chevron during the period. Expro
was selected to design and build next generation subsea tools critical to the
safe installation of this deepwater field and successfully concluding the
installation of the first phase of wells in this record breaking development
during the first six months of the year.
These outstanding achievements were complemented by technical and commercial
progress with AX-S lightweight subsea wireline intervention system and by a second
successive RoSPA sector award for health and safety performance. Winning this
prestigious award two years in succession is a first for an upstream services
provider and has helped project Expro into the top 20 of ethical businesses on
the FTSE.
Graeme Coutts, Group CEO commented: "I am very pleased with the pace of
development at Expro. Our prior year activities have delivered increased
exposure in markets which are appreciative of technology and service quality.
The outlook for international late cycle upstream services remains good and we
continue to invest to help our customers meet their needs, both short and long
term. Technology and service quality which aid operational efficiency will be
vital if we are to meet the challenge of adding global production against a
backdrop of the ever accelerating decline of producing assets. We are confident
of reporting good progress for the first half of the year and are very well
placed for continued growth in the second half and beyond."
- Ends -
For further information please contact:
Expro International Group PLC
Graeme Coutts, Chief Executive Officer 0118 959 1341
Michael Speakman, Finance Director
Weber Shandwick Financial 020 7067 0700
Nick Oborne / Rachel Martin / Hannah Marwood
Notes to Editors
Expro's business is well flow management. Expro is a leading provider of
products and services that measure, improve, control and process flow from
high-value oil and gas wells. Key niche businesses must be able to command and
sustain market share leadership through a combination of technological
pre-eminence and/or operational economies of scale. They will have a high
knowledge and service content and will be able to anticipate, meet and exceed
customers' expectations. With its head office in the UK, Expro employs more than
4,000 highly-trained staff in 50 countries. For more information, please visit
the Expro website www.exprogroup.com.
This information is provided by RNS
The company news service from the London Stock Exchange