Plexus Holdings PLC (LON:POS) chief executive Ben Van Bilderbeek has hailed the “resilience” of the company’s licensing business model as the firm said it expects to report a narrower year on year loss for its 2020 financial year despite disruption to the oil and gas markets during the coronavirus pandemic.
In a trading update for the year to June 30, 2020, released late on Friday afternoon, the oil and gas engineering services group also said its operations team were “actively engaged with a number of operators in relation to actual and prospective tender opportunities covering the next three years”, the value of which it said was larger than any target pipeline it had pursued in the past.
Van Bilderbeek added that the firm’s debt free balance sheet, its partnerships with fellow engineering groups Gusar and TechnipFMC and “a capability to supply package solutions covering key markets, and a broadening product suite based around our innovative IP" meant the company was “well placed to withstand the downturn [in the oil and gas market] but also to play an active role in the recovery when it comes”.
In terms of trading for the year, Plexus said the sharp falls in oil demand and crude prices due to the uncertainty caused by coronavirus had been “far worse than anticipated”, and as a result, a number of these operators have since taken the decision to defer awarding contracts in its next financial year.
Therefore, the firm said its revenues for its 2020 financial year are now expected to be materially below expectations, while its cash position is expected to be “broadly in line with expectations”.
Shares in Plexus were steady at 14.5p in late-morning trading on Monday.