Plexus Holdings PLC (AIM:POS) CEO Craig Hendrie talked with Proactive about the company's strategic growth and recent £3 million fundraise. Hendrie, who took on the CEO role in July 2024, explained how Plexus is expanding its wellhead rental business to capitalize on strong demand. The investment will double the company’s rental fleet from 8 to 16 systems, enhancing its ability to generate recurring revenue.
He highlighted the profitability of the rental model, with a return on investment in under a year, positioning Plexus for self-sustaining growth. Hendrie also discussed the company’s wider market opportunities beyond traditional oil and gas, including decommissioning, carbon capture, and hydrogen storage.
"The rental returns in this business are very strong. We can charge based on what the equipment does rather than its cost," he stated.
With government sentiment towards oil and gas fluctuating, Hendrie emphasized that Plexus has strategically positioned itself to thrive regardless of market conditions.
Proactive: Hello, you're watching Proactive. Joining me is Plexus Holdings CEO Craig Hendrie. Craig, very good to speak with you. As you recently took up the position of CEO and it's your first time on Proactive, could you tell us a little bit about yourself and about Plexus?
Craig Hendrie: Yes, thank you very much. Very pleased to be here. Plexus is a wellhead technology company. We've been around for 40 years, working on pushing innovation in wellhead technology. A wellhead itself is the device at the top of a well, which helps to manage the safety and integrity of a well.
We've always been at the forefront of exceeding industry standards and introducing new equipment to the market. This provides improved safety and, in some cases, significant cost savings. I am an engineer by background and joined the company 25 years ago. I started developing some of the technology we have today and have always been part of the management structure. I was pleased to take over as CEO in July 2024 following the retirement of our founder and previous CEO, Ben van Bilderbeek.
Proactive: I see that Plexus has just announced a successful fundraise of £3 million. Could you tell us about that and your use of the funds?
Craig Hendrie: Yes. Plexus has been at a crossroads for the past couple of years following previous periods of significant growth. Over the last two years, we have completed some licensing agreements with Schlumberger SLB, and we are now re-entering the jackup wellhead rental market.
This market allows us to rent out existing inventory on a rapid, month-by-month basis rather than manufacturing new equipment, which can take up to 12 months. We see huge potential due to recent modernization efforts. Almost all of the £3 million raised will go toward capital expenditure, expanding our wellhead fleet from 8 to 16 systems. This will provide the revenue base to support our growth in the years ahead.
Proactive: There's also a retail offer for existing shareholders that is currently open. What are your thoughts behind that?
Craig Hendrie: Yes, we have completed a £3 million raise from institutional investors and company management. However, we also recognize that we have a significant retail investor following, particularly over the last two years. To ensure fairness, we opened up a retail opportunity so that existing shareholders could participate if they wish.
Proactive: From an investor's point of view, what type of financial returns can this rental business deliver?
Craig Hendrie: The rental business provides very strong returns. This is a highly technical market, and we can price our equipment based on its functionality rather than just its underlying cost. This results in a return on investment of less than a year for our rental equipment.
It is a highly profitable business that underpins our revenue, allowing us to explore other major projects. Once we reach our critical mass of 16 systems, the business will be self-funding, enabling continued reinvestment and expansion.
Proactive: With so many possibilities, could you tell me more about your strategy for growth?
Craig Hendrie: Plexus has a broad range of intellectual property and products, including rental wellheads, subsea wellheads, and POS-GRIP technology. We have also engaged in licensing, and we have additional developments in connectors, valves, and trees.
For now, we are focusing on the short-term growth of our rental business. However, we are still investing in research and development behind the scenes to drive future expansion. In the medium term, we expect significant value from our POS-GRIP technology and subsea applications.
Proactive: With UK sentiment toward oil and gas at an all-time low, how do you see Plexus growing in this market?
Craig Hendrie: That’s a good question. In the past, we have been affected by fluctuations in oil and gas prices and changes in UK government sentiment. To counter this, we have ensured that our wellhead technology is optimized for jack-up rigs, regardless of their function.
For example, we are still working in the North Sea on decommissioning and plug-and-abandonment wells. Additionally, there is increasing activity in carbon capture drilling, offshore natural gas exploration, and hydrogen storage—all of which require wellheads.
By consolidating our expertise into a single wellhead product that serves multiple applications, we have positioned ourselves to grow regardless of political or regulatory changes.
Proactive: Craig, I hope you'll keep us updated on your progress. Thank you very much for speaking with us today.