REG - Enteq Technologies - Year-end Trading Update

Enteq TechnologiesAnnouncement

10/04/2024 07:00

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RNS Number : 9233J  Enteq Technologies PLC  10 April 2024

Enteq Technologies plc

 

("Enteq" or the "Company")

 

Year-end Trading Update

 

Enteq Technologies plc (AIM: NTQ.L) the specialist energy services engineering
and technology company is pleased to provide a trading update for the
financial year ended 31 March 2024 and an update on the progress of the SABER
Tool (Steer-At-Bit Enteq Rotary) technology.

 

Trading update:

Trading reflects the Company's strategy to focus on SABER development and
commercialisation, whilst maintaining a lean overhead base.

The cash balance as at 31 March 2024 was $3.0m ($5.3m at 31 March 2023, and
$5.1m at 30 September 2023). The movement in cash during the financial year
reflects continuing investment in SABER, and the steps taken towards full
commercialisation of the tool.

Revenue for the full year ended 31 March 2024 will be in the region of $0.9m
representing the final revenue following the sale of the XXT business. The
adjusted EBITDA(1) loss for the year is expected to be approximately $2.9m
compared to the equivalent loss of $1.6m in the first half of the year. The
EBITDA result reflects the discipline on lean overhead management while
maximising liquidity for the SABER commercialisation.

 

SABER update:

The SABER Tool and personnel are currently on-location in a live drilling
environment with the customer in Australia as part of a structured customer
test programme, expected to then progress to active commercial operations.

The downhole active drilling programme, performed at the Catoosa, USA test
site in February 2024, has again successfully proved the steering ability of
the SABER Tool, with this phase of testing proving additional technical
capabilities of the tool. Potential customers and strategic partners have
reviewed the results of the testing from Catoosa, which has led to ongoing
commercial discussions with these selected industry parties.

The build-programme for the further fleet of equipment is progressing as
planned, with the major items now in stock at the Houston facility. Additional
incremental performance and production improvements have been implemented and
tested.

 

Andrew Law, CEO of Enteq Technologies plc, commented:

"We are pleased with the technical and commercial progress that has been made.
Following the recent Catoosa testing, it has been encouraging to see good
levels of engagement with potential strategic partners and customers in the
industry."

For further information, please contact:

Enteq Technologies plc
                           +44 (0)20 8087 2202

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

Andrew Law, Chief Executive Officer

Mark Ritchie, Chief Financial Officer

 

Cavendish Capital Markets Limited (NOMAD and Broker)         +44
(0)20 7220 0500

Ed Frisby, George Lawson (Corporate Finance)

Andrew Burdis (ECM)

 

The financial information for FY24 included in this announcement is unaudited.

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

 

About SABER:

Enteq has a track record of developing and commercialising technical equipment
in a drilling environment for oil, gas, geothermal and now also energy
transition. SABER commercialisation is the primary focus for the Company and
provides a novel approach to steering the bit while drilling the well; it is
an alternative to existing Rotary Steerable Systems (RSS).

The SABER Tool is based on a concept originally developed by Shell, where
rather than using pads or pistons to create steering forces, the SABER Tool
uses an internally directed fluid pressure differential system. By removing
these external contact points, the SABER Tool achieves true at-bit steering
for the first time and the mechanically simple design gives the potential to
improve reliability and project uptime versus conventional RSS solutions.

Enteq has the exclusive global license for this novel rotary steerable
technology and IP from Shell. Enteq has developed and refined the concept,
generating additional protected IP. Following successful field testing, the
SABER Tool is now commencing customer testing, and is being readied for
commercial deployment.

The global RSS market is worth approximately US$3.6 billion annually according
to a recent 2023 report from Spears. The SABER Tool has the potential to drive
operational efficiency across the world's directional drilling applications,
including hydrocarbon production, geothermal energy, methane capture and CCS
(carbon capture and storage). Enteq will provide the SABER Tool to customers
through a service arrangement or equipment purchase, providing independent and
regional directional drilling companies more opportunity to compete with major
integrated service companies which have to date dominated this segment.

 

 

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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