Petrofac Limited - AGM Statement
"In this unprecedented period, we are working tirelessly to safeguard the interests of all our stakeholders. We have implemented stringent health measures to protect our people, clients and suppliers. We are working hard to mitigate the disruption caused by COVID-19 on project progress and lower oil prices on our bidding pipeline. And we have taken swift and decisive action to significantly reduce costs, retain our competitiveness and preserve the strength of our balance sheet.
"Throughout this period, I have been overwhelmed by the dedication and commitment of my colleagues in taking the tough decisions necessary to best position
"This is the first year the Board will not have the opportunity to meet fellow shareholders in person, a necessary precaution to protect health at the current time. Nevertheless, I want to thank our shareholders, clients and other stakeholders for their continued support in these challenging times. Whilst the outlook remains unclear, the Board is fully supportive of the steps management are taking to preserve shareholder value."
UPDATE ON MARKET CONDITIONS AND OUR RESPONSE
COVID-19 has caused significant disruption to our Engineering and Construction (E&C) projects due to stringent health protocols, supply chain disruption, travel restrictions and Government-enforced lockdowns. Whilst projects are still progressing, this has inevitably resulted in material delays in construction activity, which will not be recovered in 2020. Operations and maintenance activity in our Engineering & Production Services (EPS) business continues in all regions, albeit travel and social distancing restrictions are having a modest impact on activity levels and our training centres have been temporarily closed.
In addition, the collapse in oil prices has been the catalyst for clients to review their future investment plans. This is evident in delays to current tenders in E&C, as well as the recent termination of the
In order to mitigate the impact of the COVID-19 pandemic and lower oil prices on financial performance and order intake, we are taking action to reduce costs, retain our competitiveness and preserve the strength of our balance sheet. We are targeting additional savings to those announced on 6 April, and now expect to reduce overhead and project support costs by at least
Looking ahead, it remains unclear how long COVID-19 and low oil prices will continue to disrupt business activity and impact business performance. Notwithstanding this, we have a healthy order book of secured revenue, a strong balance sheet, liquidity of
Our next market update will be the pre-close trading statement on our first half trading on 25 June.
(1) Gross liquidity of
(2) Net debt was
This announcement contains forward-looking statements relating to the business, financial performance and results of
This announcement contains inside information which is disclosed in accordance with the Market Abuse Regulation.
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Market Cap: £581.31 m
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