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Africa Oilfield Logistics (LSE:AOL), an AIM listed African focused support services and logistics company, announces its results for the period ended 30 June 2013.
CHAIRMAN’S STATEMENT (in full):
Africa Oilfield was established in December 2012 as an investment company focussed on the logistics and support service industry in sub-Saharan Africa. This geographic focus was chosen to capitalise on the resource boom currently underway in Africa, which includes two of the world’s leading emerging resource development areas, namely the East African Rift Valley and the East African (including Mozambique) offshore gas exploration sector, in addition to prospective opportunities available in Madagascar, West and North Africa.
To support the Company’s strategy, Africa Oilfield raised £6.5 million (US$10 million) and listed on AIM in June 2013. In August the Company acquired a 49% interest in Ardan Risk & Support Services (‘Ardan’), a provider of quality turn-key support services and logistics solutions to international corporate companies operating on the African continent. Head quartered in Nairobi and operating currently in Kenya, Ethiopia and Mauritius, Ardan provides Africa Oilfield with a foothold and an on-ground operating team in Africa, which the Company believes it can leverage to build a leading support services and logistics business. Discussions are continuing with Ardan as to expediting and maximising the benefits of full integration.
Africa Oilfield believes that the key to building a successful business is the experience of operating in Africa, the ability to attract the right people and a defined operational structure that enables a quality service provision. Ardan’s divisional structure for a full spectrum of products and services is based on six key, distinct and focussed divisions, which are listed below.
– Engineering and Infrastructure Development, whose services range from well site, road and airstrip construction, to water treatment installation;
– Workforce Accommodation, which rents and sells remote workforce housing and modular workspace solutions and associated services;
– Facilities Management, which provides full turnkey lodging solutions including premium catering services, communication installation and environmental waste management;
– Medical Services, which provides a full range of internationally accredited advanced life support and general medical services including medi-vac, onsite medical facilities, and medical training;
– Procurement & Logistics, whose services range from procurement and warehousing, to transportation of industrial equipment and machinery to general logistical supply solutions; and
– Risk Management, which offers, full risk assessment programmes, and tailored security solutions and protocols
It is this multi-divisional structure that enables the servicing of multiple sectors and provides an internationally accredited and tailored service to meet the requirements of clients operating in all environments. An aggressive growth strategy is being implemented to expand the client base and build a highly scalable business offering.
As part of Ardan’s strategy to widen and strengthen the competitive offering, in October 2013 an investment allowing for a 20% acquisition was made by Ardan into Energy Resources Group Africa Limited, a specialist provider of professional onshore and offshore safety, survival and emergency response training, targeting companies operating in the oil and gas industries. This builds a foundation relationship to the only such business in East Africa and will provide significant cross selling opportunities.
Financials:
Africa Oilfield is reporting for the period ended 30 June 2013 a pre-tax loss on continuing activities of US$155,000. The Company has an adequate treasury and as at 30 June 2013 cash balances were US$9.2million
Outlook:
Africa Oilfield is rapidly developing its business and fulfilling its strategy of becoming the support services and logistics company of choice servicing the sub-Saharan Africa resource sector. Resource development is critical to Africa’s success and is being actively encouraged politically, creating a huge opportunity to expand the business both in terms of client numbers and geographically. Africa Oilfield with its first mover advantage, high calibre management team, quality projects with international blue chip clients both underway and in the pipeline, and a defined development strategy, is well placed to effect significant growth in the oilfield and resource services sector, in one of the world’s leading resource development regions.
