James Fisher & Sons PLC (LSE:FSJ) has said it is still looking to sell off part of its business after profits sank over 60% in the first half of the current year.
Revenue for the marine service provider in the first six months of 2022 rose by 2% to £238.4mln but profit before tax fell to £3.2mln from £8.1mln a year ago. Last year the group made a profit in the first half but a full-year loss.
Underlying first half 2022 operating profit fell by 29% to £9.5mln and is now expected to be “broadly in line” with last year's £28mln, with the second half anticipated to be “materially stronger” than the first, helped by strong order books in Offshore Oil and Marine Contracting, as well as a more encouraging pipeline of potential projects for Specialist Technical, though the timing of new long-term project wins is "uncertain".
The reason for the smaller first half profit was “portfolio mix”, said James Fisher chairman Angus Cockburn, taking the lead as new chief executive Jean Vernet only started work on Monday.
He blamed “subdued” markets for Fendercare, provider of ship-to-ship and other products and services to marine, naval and offshore energy industries, as well as the Specialist Technical division’s “cyclical nature of project work”.
On the upside, Offshore Oil and Tankships arms grew revenue and profits, while Marine Contracting continued its turnaround, he said.
Management are “taking decisive actions” to address the ongoing issues affecting group performance, Cockburn said, “including rolling out an operational excellence programme across the group; continuing to explore ways to rationalise the portfolio; and restructuring the Fendercare and JFD businesses”. More strategic actions will be completed in the second half, he said.
Broker Peel Hunt said £2m of provisions taken above the line meant that James Fisher's underlying operating profit was "slightly worse than we anticipated".
Pell Hunt cut its share price target for James Fisher to 400p from 500p.
The shares fell 8.5% to 279.23p in early trade.