Plexus Holdings Plc (LON:POS) said as momentum towards a carbon-neutral world builds the oil and gas industry is positioning itself to be in the mainstream rather than on the fringes, as it posted interim results.
The shift presents potential benefits for Plexus which has developed a modern leakproof solution, called POS-GRIP, for wellhead equipment.
The specialist engineering firm so far has licensing or collaboration agreements in place with two of the top three major international service companies.
“For our industry to be able to make this journey, there is a growing recognition that out-dated technologies are no longer fit for purpose and must be replaced by cleaner, more efficient, and more reliable methods and equipment in order for the industry to have any realistic chance of meeting net-zero targets,” said chief executive Ben van Bilderbeek.
“We believe that Plexus, with our field-proven POS-GRIP leak-proof technology, is well-positioned to maximise the opportunities that are now beginning to open up to us, especially in relation to natural gas, the cleanest fossil fuel, which it is widely reported will increasingly be used to produce hydrogen, over the coming years.”
In terms of financial results, the company revealed rising sales revenue from continuing operations, to £419,000 from £49,000 in 2019, and narrowing pre-tax losses at £1.99mln from £2.76mln. It reported an earnings (EBITDA) loss of £1.21mln versus £1.8mln in the prior year.
The company ended the half year, at December 31, with some £2.3mln of net cash.
Plexus noted that the half year results are in-line with internal budgets and that revenue is projected to by higher in the second half of the financial year.
It presently expects that full-year results will be in-line with market expectations.
“The ongoing pandemic and associated lockdowns both in the UK and around the world, while highly disruptive, did not prevent progress being made towards rolling out the dual focused strategy we have put in place to establish our POS-GRIP technology in new markets through licencing and direct sales activity,” Ben van Bilderbeek added.
He, meanwhile, highlighted: “In July 2020 we announced the award of an order for a POS-GRIP surface production wellhead system from Spirit Energy. The contract is progressing as planned, and as a result we would expect to recognise the majority of revenues from this contract in the second half of 2021.”
"In terms of licencing, in November 2020 we were delighted to announce an important initial Licence Agreement with Cameron, a Schlumberger group company, the world's leading oil services provider.
“We are excited about the potential that this new relationship offers for POS-GRIP technology in the surface production wellhead sector, and indeed have been very encouraged by the level of positive engagement to date by our newest licencee in these early days of the partnership.”