Enteq Technologies PLC (AIM:NTQ) reported an increase in full-year underlying earnings (EBITDA) as revenues rose and costs were cut.
The energy services technology supplier reported total revenue of US$7.3mln for the year to 31 March 2022, up 43% on the year before and higher than previous guidance as a big jump in North America offset reduced activity in China.
Although gross profit margin slipped to 36% from 53% due to a change in product mix from new strategic distribution partnerships, EBITDA rose to US$0.3mln from US$0.1mln.
Administrative expenses before amortisation were cut to US$3.2mln from US$3.9mln and the loss attributed to shareholders to US$0.8mln from US$1.1mln.
The cash balance was US$4.8mln at year end.
Enteq's core MWD (Measurement While Drilling) business has benefitted from the continued growth in the US market, new customers in the US, new customers internationally and from access to selected technology distribution agreements, said chief executive Andrew Law.
Meanwhile, Enteq has continued to invest in the development of its new guiding and drill-positioning technology, SABER, which was said to remain on track for commercialisation during this calendar year.
The SABER tool is designed to be a more accurate and more agile rotary steerable system, which is steered right at-the-bit in order to reduce wear and improve project uptime and cost efficiency.
SABER development work has created “an enhanced, simplified design with a wider range of operation and a low cost to operate”, said Law.
“Sustained testing has confirmed the system has performed to the design criteria and met all requirements to date, thereby further reducing technical risk. Extensive industry engagement with existing and new customers both internationally and across North America, has confirmed that SABER is on track to meeting the market requirements.”
He said the core existing MWD customer base will be the initial target market for SABER.
“As with the core MWD technology, SABER has applications in geothermal and methane capture operations as well as conventional oil and gas, giving the board grounds for optimism for the short, medium and long term outlook."
In the short and medium term, the continued growth of the US rig count gives optimism regarding that market, while international market showed signs of recovery during the latter part of the financial year.