Kvaerner boosts 3Q profit while revenues plunge

Norwegian engineering and construction company Kvaerner on Wednesday posted a higher profit for the third quarter of 2016, when compared to the same period last year, even though its revenues dropped during the quarter. 

According to its report on Wednesday, the company’s net profit total operations for the third quarter of 2016 was NOK 265 million ($32.4M) compared to NOK 74 million ($9.1M) in the corresponding quarter last year.

Further, the company’s operating revenues in the third quarter of 2016 amounted to NOK 1 975 million, compared with NOK 2 858 million for the third quarter of 2015. Kvaerner explained that the lower revenues were mainly due to lower activity within operational area Process Solutions.

When it comes to orders, as of September 30, 2016, Kvaerner’s order backlog was NOK 8 397 million, down from NOK 10 172 million at the end of the second quarter. Order intake was NOK 1 049 million in the third quarter, including the NOK 350 million pre-EPC call off for preparations and docking of the Statoil-operated Njord A platform at Kvaerner’s Stord facilities.

As for the outlook, Kvaerner noted that several oil companies said they expect an increase to the oil price which may trigger the start of new projects. However, Kvaerner added, it is difficult to estimate the timing of possible new investments and what kind of development solutions key customers may decide on.

“This creates uncertainty for the activity level in 2017 and onwards. Kvaerner is dependent on winning sufficient new contracts to secure an effective capacity utilization,” the company concluded.

Offshore Energy Today Staff