REG - Enteq Technologies - Year-end Trading Update

Enteq TechnologiesAnnouncement

07/04/2022 07:00

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RNS Number : 5472H  Enteq Technologies PLC  07 April 2022

 

 

 

Enteq Technologies plc

 
 ("Enteq")

Year-end Trading Update

 

 

Enteq Technologies plc (AIM: NTQ.L) the energy services technology supplier is
pleased to announce a trading update for the financial year ended 31 March
2022.

 

Market recovery has resulted in revenues above expectations and adjusted
EBITDA(1) in-line. SABER(2) technology development continues to be on-track,
with sufficient cash to take it through commercialisation in 2022.

 

Trading Update

The North American benchmark ("WTI") oil price per barrel rose from around $63
in April 2021, at the start of the financial year to around $92 in March 2022,
with the North American active rig count steadily increasing throughout the
year from 430 to approximately 670 in March 2022. International recovery in
active rig count started to increase approximately six months after the North
American market, as expected.

 

Enteq's reported revenue for the second half of the financial year will be in
the region of $4.9m, a significant increase over the $2.3m achieved in the
first half. Revenue for the full year ended 31 March 2022, will thus be in the
region of $7.2m, ahead of the Board's previous expectations.

 

The international market (excluding China) started to recover in the second
half of the financial year, with equipment being delivered to a new customer
in Central Asia. Since the beginning of the hostilities towards Ukraine, Enteq
has not been doing business with Russia, with minimal business impact. A
delayed recovery in China has been offset by an increase in revenues from
North American activity.

 

Adjusted EBITDA for the year is expected to be $0.3m, in-line with
expectations. The gross margin reflects a sales mix now including an increase
in revenues relating to third-party technology partnership agreements. The
cash balance as at 31 March 2022 was $4.9m ($5.3m as of 30 September 2021,
$8.1m as of 31 March 2021) reflecting the scheduled on-going investment in
technologies throughout the year, primarily the SABER technology development.

 

 

Technology Investment

Testing has demonstrated that SABER's unique steering concept can generate
sufficient steering forces to perform effectively. Therefore, this simple and
lower cost to operate system has the potential to offer efficiency
improvements and to disrupt the current market. The system has applications in
geothermal, oil and gas and methane capture, with the oil and gas RSS market
being over $1.9bn annually.

 

The SABER system is on-track for commercialisation during 2022, with existing
resources in place to complete the remaining phase of the development
project.

 

 

The Company expects to announce its results for the year ended 31 March 2022
on 6 July 2022.

 

 

Enteq Technologies
plc
+44 (0) 20 8087 2202

www.enteq.com (http://www.enteq.com/)

Andrew Law, Chief Executive Officer

David Steel, Chief Financial Officer

 

finnCap Ltd (NOMAD and
Broker)                                 +44
(0) 20 7220 0500

Ed Frisby, Emily Watts, Tim Harper (Corporate Finance)

Andrew Burdis, Barney Hayward (ECM)

 

 

The financial information for FY22 included in this announcement is unaudited.

 

 

(1) Adjusted EBITDA is reported profit before tax adjusted for interest,
depreciation, amortisation, foreign exchange movements, performance share plan
charges and exceptional items.

 

(2) SABER (Steer-At-Bit Enteq Rotary Tool), a potential 'game changer'
compared to current rotary steerable systems available, enables Enteq to enter
the Rotary Steerable Drilling service market which has an estimated world-wide
annual value of over $1.9bn in 2022, of which approximately 40% is accessible
by the SABER Tool technology.

 

 

 

The information contained within this announcement is deemed to constitute
inside information as stipulated under the retained EU law version of the
Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK
law by virtue of the European Union (Withdrawal) Act 2018. The information is
disclosed in accordance with the Company's obligations under Article 17 of the
UK MAR. Upon the publication of this announcement, this inside information is
now considered to be in the public domain.

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