BAKU, Azerbaijan, Apr.20
By Leman Zeynalova – Trend:
Petrofac Group’s revenue decreased 26 percent to US$4.1 billion in 2020 (2019: US$5.5 billion), Trend reports with reference to the company’s data.
This was principally due to a decline in revenue in the Engineering & Construction (E&C) operating segment, which decreased 31 percent due to a decline in project activity, COVID-19 related project delays and lower variation orders.
Engineering & Production Services (EPS) operating segment revenue grew 5 percent, with growth in Projects largely offsetting lower activity from Operations. Revenue in the Integrated Energy Services (IES) operating segment decreased 43 percent, reflecting the fall in average realized prices, lower equity production, and lower tariff income and cost recovery in Mexico. The Group generated revenue from a broad range of geographic markets in 2020 with Oman, Thailand and Algeria generating 47 percent of Group revenue (2019: top three markets – Oman, Kuwait and the UAE – generated 50 percent of revenue).
Business performance net profit attributable to Petrofac Limited shareholders for the year decreased 83 percent to US$48 million (2019: US$276 million) driven by lower EBITDA, partially offset by lower net finance expense, lower tax expense, and lower depreciation and amortization. Business performance net margin decreased to 1.2 percent (2019: 5 percent). A reported net loss of US$180 million(1) (2019: US$73 million net profit) was negatively impacted by separately disclosed items of US$228 million (2019: US$203 million), of which approximately US$209 million were non-cash items.
The Group’s financial performance in 2020 reflected the deterioration in market conditions triggered by the COVID-19 pandemic and subsequent decline in oil prices. Overall, revenue and profitability declined, as these unprecedented market conditions disrupted project schedules, increased project costs, delayed tender awards and impacted commercial settlement discussions.
---
Follow the author on Twitter: @Lyaman_Zeyn