Petrofac shares plummet after profit warning

 
Suzie Neuwirth

PETROFAC’S shares plunged nearly 17 per cent yesterday, after the oil and gas services provider warned that next year’s earnings would be hit by project delays.

The FTSE 100-listed firm forecast group net income next year to show “flat to modest growth”, due to the expansion of the Upper Zakum offshore oil field development in Abu Dhabi and the redevelopment of the second stage of the Berantai gas project in Malaysia.

“Given the earnings growth expected in 2015 from the integrated energy services division, driven by the anticipated step-up in production from our equity upstream investments, we continue to expect strong year-on-year growth in group net income in that year,” said Petrofac’s chief executive Ayman Asfari.

“Although the achievement of our 2015 earnings target will also be dependent on the timing of potential engineering, construction, operations and maintenance (ECOM) contract awards during 2014,” he added.

Petrofac had said in 2010 that it would double its earnings by 2015.

Order intake for the ECOM division has hit $5.9bn (£3.7bn) in the year to date, including a $650m project for the Alrar gas field in Algeria.

“We expect to exit 2013 with our highest ever year-end backlog [of orders],” said Asfari.

Shares closed down 16.6 per cent.