Shares in Kbc Advanced Technologies (LON:KBC) surged by 17.7% to 53p this morning after the AIM quoted engineering group said it had been awarded a record $42m contract to supply a profit improvement program to Mexico based oil refinery group Pemex Refinacion. The 30 months program has been extended from an initial two sites to six sites earlier than anticipated and represents the single largest contract in KBC’s history.
KBC said the final contract was expected to be concluded by the end of this month. Work has started this week at the first two sites in order to commence interviews and gather data in preparation for the commencement of the contract. The assignment document confirms that this work will be reimbursed to KBC in accordance with the terms of the final agreement. The extension of the contract to all six sites is set to give KBC a significant increase in its backlog of work for 2011 as well as ensuring the anticipated improvement in its consultant utilization for the balance of the current year.
George Bright, KBC’s chief executive, said: “The industry background of challenge and change offers KBC good opportunities to sell its consulting services and products. We are delighted with the award of this significant project with a long standing client. We look forward to working with Pemex over the next two years in delivery of the program goals.”
Last month, KBC reported a decline in revenues for the first six months of the year to June 30, to £25.6m from £27.1m previously. Pre tax profits were up to £1.8m from £1.5m, with underlying PTP down to £1.4m from £2.4m.
Interesting to note that KBC was very much a value investment before the recent price rise- ttrading on a p/e ratio of around 8, and with a net TANGIBLE assets of 33 pence per share - not too bad for an exciting company when it was trading at 45 pence per share. Encouraging to see a growth stock without a ridiculous price tag.
