REG - Hunting PLC - Year-End Trading Update

HuntingAnnouncement

15/12/2022 07:00

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RNS Number : 7476J  Hunting PLC  15 December 2022

 For Immediate Release  15 December 2022

 

 

 

 

Hunting PLC

 

("Hunting" or "the Company" or "the Group")

 

Year-End Trading Update

 

Hunting PLC (LSE: HTG), the international energy services group, today issues
a year-end trading update ahead of announcing its 2022 Final Results on
Thursday 2 March 2023.

 

Highlights

 

·           2022 trading and financial outturn remains in line with
market expectations, with an EBITDA of c.$50m projected.

 

·           Hunting's sales order book continues to improve
following further order wins within the Subsea Technologies business group.
The Group's total sales order book now approaches c.$500m.

 

·           2023 market expectations raised with an EBITDA target
in the range of c.$85m-$90m - previously c.$80m.

 

·           Formation of global Energy Transition sales group to
pursue carbon capture, geothermal and other low carbon technologies.

 

Jim Johnson, Chief Executive of Hunting, commented:

 

"2022 has been a year of rebuilding for the industry with 2023 now likely to
be a strong year of growth for the Group. All of our operating segments are
reporting good levels of enquiries, and with our order book now approaching
$500m, our earnings visibility for the year ahead is robust, despite
recessionary fears.

 

"The formation of our Energy Transition global sales group is another step in
our strategy to expand our revenue base to new and complementary sub-sectors
of the energy industry. Hunting is well placed to capture a meaningful market
share in the component supply chain for many low carbon projects, given the
alignment of current technologies with the traditional oil and gas industry
and the international commitments made by governments to reduce carbon
emissions."

 

Trading Statement

 

Trading in Q4 2022 has remained in line with management's expectations with
EBITDA still anticipated to be c.$50m for the full year.

 

The Group's sales order book has continued to strengthen through the quarter
and now approaches record levels of c.$500m, following a further large order
win for titanium stress joints and accessories for a client operating in South
America. This order book will mainly be delivered during 2023; however, due to
the long delivery cycles of certain product lines, a proportion of sales will
be recognised in 2024 and 2025.

 

Hunting Titan continues to report steady sales across North America as clients
maintain activity levels. New opportunities continue to be pursued in South
America, with drilling and completion activity accelerating as unconventional
resources are developed, coupled with the continued migration of clients to
new technology. In the coming months, Titan is to launch the H-4 perforating
system, which is a self-orientating system that improves the accuracy of
completions and which will provide new sales opportunities in Titan's core
markets of the US and Canada.

 

Within the North America operating segment, the Premium Connection,
Accessories Manufacturing and Subsea business units continue to report strong
momentum. Further, the performance of the Advanced Manufacturing group has
continued to report improving results through the quarter, as supply chain
constraints lessen.

 

The EMEA operating segment also reports improving results, supported by the
Tubacex contract for Brazil. The Group's Netherlands facility is now operating
three shifts in support of this contract, with a second shift being added in
Aberdeen in support of the order, and as broader activity levels increase
across the region.

 

In Asia Pacific, the segment has reported steadily improving performance since
the middle of the year as drilling activity in the Middle East and South East
Asia increases. The segment has commenced the CNOOC order, which will see
revenue and profits being recognised in 2023.

 

The Group's balance sheet remains strong, with net assets as at 30 November
2022 of c.$847m. Cash and bank was $24m as at 30 November 2022, with a
year-end position likely to be c.$20m as raw material purchases continue to
support the Group's order book. Capital expenditure for the full year is now
anticipated to be up to c.$20m.

 

2023 Trading Expectations

 

Given the record sales order book noted above, the Board now believes that
2023 will see a stronger performance than anticipated previously. EBITDA for
the year ahead is now targeted at $85m-$90m - previously c.$80m.

 

Formation of Energy Transition Sales Group

 

The Board of Hunting PLC is pleased to announce the formation of a new Energy
Transition global sales group to pursue energy transition opportunities.
Following a review of its portfolio of products and geographical presence, the
Group has formed the new sales group under the leadership of Sean O'Shea. Sean
has a strong engineering and sales background and has worked within Hunting's
EMEA and Asia Pacific operating segments developing the Group's international
sales presence across many of Hunting's product lines.

 

Given the opportunities to participate in geothermal and carbon capture
projects, with many initiatives being announced in Asia Pacific, Europe and
the US, the Group will utilise its engineering expertise across all of its
current operating segments to participate in this important market segment.

 

Hunting's key product lines, which naturally align with energy transition
markets, include the Group's broad range of premium and semi-premium
connections; its pipe supply businesses and supply chain channels; its
accessories manufacturing capabilities, including couplings and valves; in
addition to existing intervention and subsea products, all of which align with
both onshore and offshore carbon capture and geothermal projects. Furthermore,
the Group's licenced Organic Oil Recovery technology will form part of the
business group, which continues to see high levels of interest with major oil
and gas companies.

 

For further information please contact:

 

 Hunting PLC                        Tel: +44 (0) 20 7321 0123

 Jim Johnson, Chief Executive

 Bruce Ferguson, Finance Director

 lon.ir@hunting-intl.com

 Buchanan                           Tel: +44 (0) 20 7466 5000

 Ben Romney

 Jon Krinks

 

Notes to Editors:

 

About Hunting PLC

 

Hunting PLC is an international energy services provider to the world's
leading upstream oil and gas companies. Established in 1874, it is a premium
listed public company traded on the London Stock Exchange. The Company
maintains a corporate office in Houston and is headquartered in London. As
well as the United Kingdom, the Company has operations in Canada, China,
Indonesia, Mexico, Netherlands, Norway, Saudi Arabia, Singapore, United Arab
Emirates and the United States of America.

 

The Group reports in US dollars across four segments: Hunting Titan, North
America, Europe, Middle East and Africa ("EMEA") and Asia Pacific.

 

From 1 January 2023, the Group will be reporting across five segments: Hunting
Titan, North America, Subsea Technologies, EMEA and Asia Pacific.

 

Hunting PLC's Legal Entity Identifier is 2138008S5FL78ITZRN66.

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