TIDMHTG
RNS Number : 5926R
Hunting PLC
02 March 2023
For Immediate Release 2 March 2023
Hunting PLC
("Hunting" or "the Company" or "the Group")
Results for the year ended 31 December 2022
Strong performance in 2022 and well positioned for 2023 with
demand
continuing to improve for all segments
Hunting PLC (LSE:HTG), the international energy services group,
today announces its results for the year ended 31 December
2022.
Financial Highlights
* Order book increased by 124% to $473.0m.
* Revenue increased by 39% to $725.8m.
* Gross margin improved to 24% from 12%.
* Return to profitability with EBITDA of $52.0m and
adjusted profit from operations of $14.6m.
* Total dividends declared in the year of 9.0 cents per
share.
Financial Summary
Financial Performance measures as defined by the Group*
2022 2021 Variance
Revenue $725.8m $521.6m +39%
EBITDA** $52.0m $3.1m +$48.9m
Adjusted profit (loss) from operations** $14.6m $(35.1)m +$49.7m
Net assets $846.2m $871.3m -$25.1m
Total cash and bank** $24.5m $114.2m -$89.7m
Adjusted diluted earnings per share** 4.7 cents (27.1) cents +31.8 cents
Final dividend proposed*** 4.5 cents 4.0 cents +0.5 cents
Financial Performance measures as derived from IFRS
2022 2021 Variance
Profit (loss) from operations $2.0m $(79.7)m +$81.7m
Diluted earnings per share (2.8) cents (53.2) cents +50.4 cents
* Adjusted results exclude adjusting items agreed by the Audit
Committee and Board.
** Non-GAAP measure ("NGM"). Please see the 2022 Annual Report
and Accounts pages 240 to 246.
*** Payable on 12 May 2023 to shareholders on the register on 21
April 2023, subject to approval at the Company's AGM.
Commenting on the results Jim Johnson, Chief Executive,
said:
"I am pleased with the Group's performance this year, delivering
good results in a period of commodity price volatility and
macro-economic uncertainty. Whilst certain challenges remain, we
are confident that we will deliver a strong performance in the year
ahead, with Hunting exceptionally well positioned to benefit from
increased investment in energy security and higher demand for
energy as China continues to re-open post COVID.
"Whilst our commitment to our growth plans in oilfield services
remains rock solid, I am delighted to be launching our Hunting 2030
Strategy today that includes increased investment to enhance our
growth in other complementary markets, including the energy
transition."
Operational and Corporate Highlights
Strong increases in activity across all operating segments as
higher commodity prices support new global drilling projects.
* External sales order book increased 124% during the
year to $473.0m (2021 - $211.5m).
* Revenue visibility increased due to level of order
book, which now extends into 2025.
139% increase in sales order book within the Subsea Technologies
division to $105.1m.
* The Subsea Spring business unit has grown materially
during the year, following new orders for steel and
titanium stress joints for the Gulf of Mexico and
South America.
* Record $48m order received in October 2022 to apply
stress joints to FPSO units.
Record OCTG contract awarded by CNOOC for Premium Connections
and Accessories.
* In August 2022, the Group's Asia Pacific operating
segment was awarded a contract for OCTG that
management estimates to be worth up to $86m for
Hunting's proprietary SEAL-LOCK XD(TM) premium
connection.
* Vast majority of order to be delivered in 2023.
Strong development of non-oil and gas sales order book within
the Advanced Manufacturing group.
* The Dearborn business now has a sales order book of
$71.3m, which comprises c.68% of non-oil and gas
sales.
* The Electronics business now has a sales order book
of $49.8m, which comprises c.14% of non-oil and gas
sales.
Construction of a new threading facility in India commenced
with Jindal SAW to support domestic activity.
* Facility to be operational during Q2 2023 with three
premium connection threading lines.
* 162,000 sqft facility is located in Nashik Province,
adjacent to Jindal's steel mill.
* Hiring of employees and QA training underway.
Formation of global Energy Transition group to build sales in
geothermal and carbon capture market sub-sectors.
* Hunting is pursuing a broad range of sales
opportunities in these growing low carbon sub-sectors,
leveraging its position in OCTG and accessories,
valves and couplings and subsea products to drive
growth.
* The Board has set a revenue target of $100m of sales
within this area by the end of the decade.
$150m Asset Based Lending facility agreed in February 2022 .
* Borrowing base secured against certain North American
freehold property, inventories and trade receivables.
* Facility agreed with four-year tenor.
* The facility provides an appropriate funding base to
pursue growth opportunities.
Outlook Statement
The outlook for energy continues to be highly robust, given the
demand projections for the year ahead, which continue to indicate a
daily requirement of c.102m barrels of crude oil per day - or an
increase of c.1.5m to 2.0m barrels per day over what was seen in
2022. The outlook for natural gas remains strong, as customers of
Russia-origin natural gas move to other global LNG suppliers.
Despite some macro-economic concerns, the re-opening of China
and material under investment in new oil and gas production since
2019 will likely lead to continued growth for all industry
participants.
Commentators continue to project an average oil price for the
year ahead of between $75 to $100 per barrel, which is a range that
will support new activity in all basins globally. Overall, the
short to medium term market outlook remains strongly positive given
the economic fundamentals driving the global demand for oil and
gas.
For Hunting, all the Group's businesses are seeing improving
demand as onshore and offshore projects increase.
Across North America, investment in drilling is projected to
grow further, following a strong performance in 2022. This will
lead to a steady growth in the demand for our perforating systems,
OCTG and accessories businesses.
Our newly formed Subsea Technologies operating segment has
delivered strong growth in its revenue profile and sales order book
over the past two years. This has been predominantly driven by the
Subsea Spring business unit, but with strong market projections for
subsea trees and SURF products, Hunting is well placed to capture
strong growth in all of our deep water orientated technologies.
These opportunities also extend to Hunting's OCTG and accessories
businesses, which supply many offshore clients with critical
components.
The Advanced Manufacturing group has built a robust sales order
book during 2022, which reflects our pursuit of non-oil and gas
sales as well as our existing energy-focused product lines.
With the newly formed Energy Transition sales group, Hunting is
also well placed to drive a further diversification in our revenue
profile, with a primary focus on geothermal and carbon capture
projects, as announced separately today.
The EMEA and Asia Pacific operating segments continue to see
strong increases in enquiries. There is likely to be good progress
in the Middle East, as drilling investment increases, which will
drive a return to profitability in the year ahead for these
segments.
In summary, Hunting remains in a good position to invest in the
market upturn to grow revenue and profitability in the year ahead.
Management is targeting further EBITDA margin expansion as price
increases, improved facility utilisation and production
efficiencies continue to be pursued.
Overall, Hunting has demonstrated its resilience during the
industry challenges associated with the effect of COVID-19, which
is due to Hunting's committed and skilled workforce, underpinned by
a world class HSE performance.
I would like to thank all of our employees for helping to guide
Hunting through a particularly challenging period, but now look
forward to a new growth phase in our chosen industry and our
Company.
Group Results Narrative
For access to narrative on the Group's results (incorporating
the Chairman's and Chief Executive's Statements, Outlook, Market
Analysis, Group Review and Segmental Review) for the year ended 31
December 2022 please click on the following link.
http://www.rns-pdf.londonstockexchange.com/rns/5926R_1-2023-3-1.pdf
Financial Statements and Notes to the Accounts
For access to the Financial Statements and Notes to the Accounts
for the year ended 31 December 2022 please click on the following
link.
http://www.rns-pdf.londonstockexchange.com/rns/5926R_2-2023-3-1.pdf
Listing Rules / Disclosure Guidance and Transparency Rules
Information
For access to Hunting's Key Performance Indicators, Business
Model and Strategy, ESG, Risk Management (including Principal
Risks), and the Statement of the Directors' Responsibilities for
the year ended 31 December 2022, please click on the following
link.
http://www.rns-pdf.londonstockexchange.com/rns/5926R_3-2023-3-1.pdf
Page number references refer to the full Annual Report when
available.
The linked documents provide access to all major financial and
operational disclosures contained in the Group's 2022 Annual Report
and Accounts. The complete 2022 Annual Report and Accounts will be
published on 16 March 2023 and can then be accessed at
www.huntingplc.com .
The financial information set out in the above links does not
constitute the Company's statutory accounts for the years ended 31
December 2022 or 31 December 2021, but is extracted from those
accounts. Statutory accounts for 2021 have been delivered to the
Registrar of Companies and those for 2022 will be delivered in due
course. The auditor has reported on those accounts; their reports
were unqualified, did not draw attention to any matter by way of
emphasis without qualifying their report and did not contain
statements under s498(2) or (3) of the Companies Act 2006. Whilst
the financial information included in this preliminary announcement
has been computed in accordance with International Financial
Reporting Standards, this announcement does not itself contain
sufficient information to comply with IFRS.
Analyst Briefing and Webcast
Hunting PLC will host an analyst briefing and webcast at the
offices of Buchanan (107 Cheapside, London, EC2V 6DN) on 2 March
2023 commencing at 9:30a.m. GMT.
The live webcast can be accessed via the following link:
https://webcasting.buchanan.uk.com/broadcast/63bd5edbdd6e71503201641c
Analysts and investors wishing to participate in a Q&A
session can do so by submitting questions via the chat function of
the webcast and these will be addressed by management during the
live webcast. If you have any queries relating to this then please
email hunting@buchanan.uk.com .
For further information please contact:
Hunting PLC Tel: +44 (0) 20 7321 0123
Jim Johnson, Chief Executive
Bruce Ferguson, Finance Director
lon.ir@hunting-intl.com
Buchanan Tel: +44 (0) 20 7466 5000
Ben Romney
Jon Krinks
Notes to Editors:
About Hunting PLC
Hunting PLC is an international energy services provider to the
world's leading upstream oil and gas companies. Established in
1874, it is a premium listed public company traded on the London
Stock Exchange. The Company maintains a corporate office in Houston
and is headquartered in London. As well as the United Kingdom, the
Company has principal operations in Canada, China, Indonesia,
Mexico, Netherlands, Singapore, United Arab Emirates and the United
States of America.
For the year ended 31 December 2022, the Group reports across
four segments: Hunting Titan, North America, Europe, Middle East
and Africa ("EMEA") and Asia Pacific.
From 1 January 2023, the Group is reporting across five
segments: Hunting Titan, North America, Subsea Technologies,
Europe, Middle East and Africa ("EMEA") and Asia Pacific.
Hunting PLC's Legal Entity Identifier is
2138008S5FL78ITZRN66.
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END
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