ADES lifts profit, targets acquisitions
Egypt’s offshore and onshore driller ADES has posted an increase in full-year profit and is targeting acquisition opportunities.
The company on Monday said its revenue grew 17.5% year-on-year, from $134.1 million in 2016 to $157.6 million in 2017. Net profit rose 17.3% year-on-year to $44.6 million in FY2017 from $38 million in 2016.
ADES in 2017 agreed to buy three operational jack-up rigs located in the Saudi Arabia for $83 million from a subsidiary of Nabors, subject to certain conditions including the novation and renewal of the rigs’ existing drilling contracts with a current major client. Upon completion, the transaction will double ADES’ Arabian Gulf fleet and number of contracted rigs.
Total backlog as at 31 December 2017 stood at #427 million, compared to #501 million as at 31 December 2016.
Mohamed Farouk, Chief Executive Officer of ADES International said: “In our first full-year results following our IPO on the London Stock Exchange in May 2017, ADES has successfully sustained its growth trajectory and delivered a strong operational and financial performance.
“In line with our post-IPO growth strategy of scaling-up operations in existing and target markets, ADES will continue to leverage its demonstrated purchasing power and streamlined decision-making process to swiftly act on acquisition opportunities that meet our criteria for delivering long-term sustainable growth.
“To expand the range of opportunities we are able to consider, the Company is committed to putting in place the necessary debt arrangements to bolster our already strong cash position following the IPO.”
ADES expects 2018 to deliver organic growth from existing operations, with the realization of several of our strategic efforts during 2017, including the start of new contracts and securing new tenders across the region, as well as from the Nabors acquisitions, which once completed, will add to the company’s revenue and earnings.
“Given the timing of completion of the Nabors transaction and the resulting contribution of the three rigs to revenues, we expect overall company revenues to be weighted materially towards the second half of the year,” Farouk said.
Regarding the targeted acquisition, the company said it was committed to putting in place the necessary debt arrangements to secure and support its current operation and future expansion. “Further information on debt transactions will be made available to the market once concluded,” ADES said.
Offshore Energy Today Staff