Company announcement no.5/2015: Welltec’s revenues reduced in the first quarter of 2015 as market activity contracted sharply in response to the lower oil price. This overshadowed growth in some geomarkets and the decline in revenue was accentuated by strong currency headwinds. EBITDA reduced accordingly, with margin impacted by lower levels of utilization and increased redeployment of fleet and personnel to match the local demand. Proactive cost management and working capital discipline allowed for improved cash flows in the period.
Michael Krabbe, Acting CFO,
Cell: +45 3034 3000
Simon Stadil, Director, Treasury and Investor Relations
Cell: +45 5213 8944
- Revenues of USD 68 million were 14% lower compared to the same period last year. On an adjusted currency basis revenues were 7% lower.
- In Europe, Middle East, Africa and Russia CIS (EMEAR), revenues decreased by 22% to USD 33 million
- Revenues in the Americas fell 8% to USD 25 million
- Asia Pacific revenues were level at USD 10 million
- Welltec® posted a 27% decrease in EBITDA to USD 26 million, representing an EBITDA margin of 38% (44% in Q1 2014)
- Operating profit (EBIT) before special items decreased to USD 11 million (USD 17 million in Q1 2014)
- Currency fluctuations impacted revenue negatively by USD 6 million and EBITDA negatively by USD 1 million
- Due to the current environment and significant uncertainty prevailing in the market, Welltec® remains unable to offer a qualified guidance for the full year 2015.
Jørgen Hallundbæk, CEO: “As expected, the first quarter was tough for the oilfield service industry as many operators scaled back activity and delayed investments, creating a vacuum as they decide on how best to sustain production and adjust operations in the low oil price environment. Our complementary completion and intervention technology provides the perfect solution. Clients that have fully embraced our approach are already benefitting, proactively intervening for barrels at a much lower cost and risk to improve their cash flows and return on investments. The prevailing market is difficult, however, and we will continue to push the adoption of new technology to meet the industry challenges.”
Investor conference call
Welltec® will discuss its results during an investor conference call today at 5 pm CET. An accompanying slide presentation will be available on the “Investor” section of Welltec’s website at www.welltec.com under the subheading “Download Center”.
The teleconference can be accessed by dialing in a few minutes before start and informing the operator that you would like to participate in Welltec’s investor conference call, conference code 3263982.
The call will also be webcast simultaneously on a listen-only basis. Please log in via the “Investor” section of the website in due time to test your browser. A replay of the webcast will then be available following the transmission.
Conference Call Access Numbers:
Denmark: +45 3271 1660
United Kingdom: +44 (0)20 3427 1903
USA: +1 646 254 3363
Welltec® develops and delivers technology and solutions intended to transform the oil and gas industry. Our game-changing solutions are dedicated to optimizing the management and development of clients’ assets, both in the form of well completion technology and intervention services required to ensure performance and integrity. We operate in all types of onshore and offshore well environments, including the most extreme and hostile, such as deepwater, subsea, extended reach, heavy oil and unconventional gas and oil wells. Our lightweight solutions are based on a vision to improve safety while reducing environmental risks, fuel consumption and carbon footprints.
Any statement in this announcement that is not a historical fact is a “forward-looking statement”. Such statements may include opinions and expectations regarding Welltec® and its future business, management’s confidence and strategies as well as details of management’s expectations of new and existing programs, technology and market conditions. These forward-looking statements rely on assumptions concerning future events that are subject to a number of risks and uncertainties, many of which are outside Welltec’s control, and which could cause Welltec’s actual results to be materially different from these forward-looking statements. While Welltec® believes that its assumptions concerning future events are reasonable, there are inherent difficulties in predicting certain important factors that could impact the future performance or results of Welltec’s business. Accordingly, such statements should not be regarded as representations as to whether such anticipated events will occur nor that expected objectives will be achieved. Welltec® expressly disclaims any intention or obligation to revise or update any forward-looking statements, whether as a result of new information, future events, or otherwise.