Lamprell Plc (LON:LAM) is performing in line with management expectations and 2010 started positively with the award of a major contract in the first quarter. The firm - which provides specialist engineering services to the international oil and gas and renewables industry - says it continues to see evidence of improvements in its operating markets and its bid activity remains high.
Lamprell is a specialist in rig upgrade and refurbishment, new build for jackup rigs, the offshore oil and gas market and oilfield engineering services. Lamprell has three primary facilities in Port Khalid and the Hamriyah Free Zone, in the Emirate of Sharjah, and in the Jebel Ali Free Zone, in the Emirate of Dubai, all of which are in the UAE. According to the latest update, the Group maintains a substantial order book extending to 2012 which at the end of March was approximately US$ 638 million, comprising approximately US$ 501 million from EPC projects and approximately US$ 84 million from offshore construction projects. In 2010 the Company has been awarded Engineering, Procurement and Construction contracts by Fred Olsen Windcarrier AS to build two offshore wind turbine installation vessels and a leading oil and gas operator in India awarded Lamprell a contract to design and construct two offshore well head platforms.
It says a priority for management continues to be its focus on pro-actively managing the group's cost base, in particular the level of labour employed and the amount of hired equipment being utilised, while at the same time maintaining first class project execution. In addition, the procurement group continues to establish strategic agreements with key suppliers and this initiative is already delivering substantial cost savings which are forecast to continue throughout 2010 and beyond. Lamprell shares are at 267.1p, down 3.4pts on the day but up significantly from the 52 week low of 83p. The Lamprell AGM will be on Monday 7th June.
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