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Annual Results

Cape adjusted pre-tax profits rise

15 March 2017 08:13

Cape's adjusted pre-tax profits rose to £47.4m in the year to the end of December - 6% up on 2015.

Revenues were up 21.4% at £863.5m and adjusted operating profits increased by 5.5% to £55.4m although margins fell to 6.4% from 7.4% last time.

On a statutory basis, the group posted a loss of £43.6m against a profit of £29.1m in 2015.

Cape said its strong trading performance had been driven by increased activity in Asia Pacific and favourable foreign exchange but UK margins were adversely affected by oil price driven weakness in the North Sea, reduced demand from the coal-fired power generation market and a small number of commercial issues.

It said corrective measures had been implemented and the business was expected to deliver a much improved performance in 2017.

It said the Middle East business delivered a solid performance.

A number of key contract wins and increased activity in Saudi Arabia, combined with a strong performance from the SOCAR-Cape joint venture in Azerbaijan, mitigated the effect of increased cost pressures, slow-downs and deferrals from customers in other parts of the region And it said the Asia Pacific business benefited from excellent operational performance on increased project activity in Australia, South Korea and Singapore, more than offsetting continuing low levels of demand in the Australian mining sector, and intense competition across the whole Asia Pacific region.

Chief executive Joe Oatley said: "I am delighted to report we have delivered strong top line growth and solid earnings per share despite the challenging market backdrop, demonstrating the resilience of our strategy.

"The settlement of the insurer product liability litigation on 12 March 2017 has removed a significant risk to the business and its stakeholders.

"In light of that litigation, our focus during 2016 has been on the delivery of our organic growth strategy and I am pleased to report that this is yielding results.

"Whilst market pressures are expected to persist for the near-term, with a strong order book and a good start to 2017, the board is confident that the business will deliver another strong trading performance in 2017.

"We continue to invest in our strategy and I remain convinced that it will deliver increased shareholder value over the medium to long-term."

At 8:13am: (LON:CIU) Cape PLC share price was +8.13p at 183.13p

Story provided by StockMarketWire.com

Related Company: CIU

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