Petrofac's LFL growth to exceed 20%

Oilfield services firm Petrofac expects to deliver like-for-like (LFL) profit growth in 2011 of at least 20%, the company announced this morning.

On the basis of contract wins so far this year, the order backlog is expected to be in the region of $10.6bn at 31 December 2011, down from $11.7bn at the end of 2010.

Its Onshore Engineering and Construction business has an order backlog of $6.5bn, down significantly from the $9bn figure at the same point in 2010. The Offshore Projects and Operations unit is slightly ahead of the prior year ($2.6bn v $2.4bn). Integrated Energy Services is significantly up ($1.5bn v $0.3bn).

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The total cash balance as of the end of December is expected to be $1.3bn, up from the same point of 2010 when it stood at $1.1bn

Petrofac is attempting to position itself in the major growth markets. Its Engineering and Consulting division has just opened its third Indian office in Delhi while also extending a strategic joint venture with China Petroleum Engineering & Construction Corporation (CPECC).

Integrated Energy Service has won two production "enhancement" contracts in Mexico while the training business has seen delegate numbers grow. Notably, Petrofac has entered an agreement with Raytheon to deliver water survival training to the oil & gas industry at NASA's underwater facility in Houston.

Petrofac's Chief Executive, Ayman Asfari commented on the results:

"We have a strong pipeline of new opportunities ... which, combined with our existing projects, gives us confidence that we can achieve our target of more than doubling our recurring 2010 group earnings by 2015."

Shares in Petrofac are down 13% so far this year versus the FTSE 100 which is down 7.55%. Over the last five years Petrofac is up 275%.

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