Norwegian oil services firm Aker Solutions posted second-quarter earnings and order backlog figures trailing expectations on Thursday, and said that sentiment in some key markets may not turn positive until after 2015. With oil firms cutting back capital spending plans and delaying or cancelling projects, bidding by contractors will become more “aggressive,” putting downward pressure on prices, said the firm.
Aker Solutions, which is spinning off some of its less profitable assets into a separate company, said exploration and production spending by global oil firms would flatten this year and next, and it would prioritise profitability over its revenue growth aspirations. In the North Sea market, hurt most by the drop in capital spending, the firm expects sentiment to turn more positive after 2015 but the global subsea and ultra-deepwater markets remained strong, it added.
The firm’s earnings before interest, taxes, depreciation and amortisation (EBITDA) fell to 429 million crowns ($69.21 million) in the second quarter, from 786 million in the year-ago period, against expectations for 1.05 billion in a Reuters poll of analysts. However, part of the miss was due to an impairment the company announced earlier this month, related to the loss of a major contract. Still, its order backlog also trailed expectations, rising to just 67.7 billion crowns from 56.8 billion a year earlier, missing forecasts for 69.3 billion crowns.
($1 = 6.1983 Norwegian Kroner)