Shares in Offshore Hydocarbon Mapping Plc (LON:OHM) tumbled by 29% to 9p today on news that the specialist oilfield surveying company was set to deliver wider half-year losses despite signs that the market for controlled source electromagnetic (CSEM) surveying was improving. It warned investors that delays to contract operations in the Asia-Pacific region were likely to put a strain on its finances later in the summer and that would potentially mean having to raise new capital to meet this squeeze.

On a brighter note, OHM said it was encouraged by continuing evidence that the market for CSEM was improving and that its industry leading abilities to maximise the value of CSEM data through close integration with seismic and well information was finding support from clients. The company’s vessel OHM Leader has been working on a number of contracts in the Asia-Pacific region, and it is expecting to soon finalise a further contract to follow on directly from this work with a projected value in excess of US$2m.

However, progress on the existing work programme has been hampered by scheduling delays resulting from naval exercises and seismic vessel operations in the work area which has increased costs. OHM said it was considering several options to help with short term working capital requirements while providing a stable long term source of investment funds.

Revenues and EBITDA losses for the six months to August 31, 2010 are expected to be in the range of £6.6m to £7.1m and £2.8m to £3.3m respectively, which compares to £3.0m and £1.8m for the same period in 2009. Cash at the period end is anticipated to be approximately £0.6m to £0.8m, although actual cash may drop below this range between now and the 2010 financial year end due to working capital requirements. OHM said it now expected to delay some of its planned capital expenditure programmes as a result.

Richard Cooper, OHM’s chief executive, said: “As we anticipated earlier in the year there are encouraging signs that the market for CSEM services generally is improving, tender activity is on the increase and our unique integrated well, seismic and CSEM offering provides a significant competitive advantage.”

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