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Petrofac Reports Swing to Net Loss in H1 2023

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Petrofac Ltd., a global provider of energy industry services, announced a significant swing to a net loss in the first half of 2023, primarily attributed to legacy contracts. However, the company also reported a substantial increase in its order book.

Financial Performance

For the six months ended June 30, Petrofac recorded a net loss of $165 million, compared to a net profit of $39 million during the same period last year. Despite this, revenue only experienced a slight decline from $1.25 billion to $1.21 billion.

The company also reported a swing to loss before interest and taxes, with a negative EBIT of $103 million instead of a previously positive EBIT of $77 million. This shift was mainly due to decreased activity levels and the presence of onerous contracts without margin recognition.

Order Book Expansion

Petrofac’s order book witnessed a significant expansion, reaching $6.6 billion as of June 30, compared to $3.4 billion as of December 31.

Future Outlook

CEO Tareq Kawash expressed his optimism for the company’s future prospects, stating, “We secured $4.3 billion of new orders in core markets and in new energies. This high-quality backlog, a growing talented team, and a diverse pipeline of future opportunities provide Petrofac with a strong foundation for moving forward.”

Share Performance

As of 0853 GMT, Petrofac’s shares experienced a decline of 2.9 pence or 3.3%, trading at 84.6 pence.

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