Africa leading Kentz's revenue growth

published 26 March 2012

Engineering services firm Kentz has grown revenues ahead of market expectations as turnover from operations in Africa more than doubled.

Kentz's biggest business is providing engineering support to the oil and gas sector but it also has a big metals and mining division and smaller power and supplementary businesses.

Revenues for 2011 came in at $1,367.5m (£862m), a rise of 29% over 2010 ($1,057.4m) and better than the market expectation of £823m.

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Profits before tax were $79.4m (£50.1m), up 18% on the prior year ($67.5m) but very slightly less than the consensus forecast of £50.3m.

The profit margin dropped from 6.4% in 2010 to 5.8% in 2011.

By the year's end the backlog of orders had reached $2.40bn, up from $1.60bn a year earlier. In the first two months of 2012 this had increased further to $2.44bn.

Earnings per share were 31.92p versus a market expectation of 31.31p, with the full year dividend of 7.75p per share, just ahead of the consensus forecast of 7.64p and a rise of 23% on the prior year.

The geographical spread of work saw income from the Middle East decline 5% to $420.4m but Africa put in a storming performance, more than doubling revenues from $264.7m to $572.1m.

Kentz's main division, oil and gas, saw revenues rise 7% to $841.8m; metals and mining grew a whopping 158%, with revenue hitting $332.7m.

Commenting on the results Christian Brown, Kentz's new Chief Executive said: "Our global spread of operations positions us well to benefit from the continued investment in both natural resource and energy markets. We are trading in line with market expectations and I am confident that we will capitalise on future opportunities to execute safe and successful projects".

Kentz shares have risen 5.28% since the beginning of the year.