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Fugro reports strong offshore growth

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Fugro has reported strong growth fuelled by improvements in the offshore market in its half year results.

The firm has seen revenue grow 16.6% to €797.4M (£709.7M) in the first half of 2018, up from €774.3M (£689.2M) in the same period in 2017, mainly driven by renewables, oil and gas and building and infrastructure.

Fugro put the revenue growth down to a recovering oil and gas market, as well as benefitting from large offshore projects working on site characterisation activities.

The firm’s EBITDA also increased by 21.6% to €56.7M (£50.4M).

In March, the firm reported that its revenues in 2017 had fallen for the third consecutive year by 16% to €1.49bn (£1.3bn).

Commenting on the most recent results, Fugro’s new CEO Øystein Løseth said: “In the second quarter revenue growth increased substantially driven by strong growth in offshore wind, growth in the building and infrastructure market and a gradually recovering oil and gas market. Oil companies are starting to increase their investment levels in order to meet future demand. This is reflected in strong growth of the early cyclical marine site characterisation activities. In the offshore wind market, where Fugro has strong positions, we benefit from large projects in the North Sea, the US and Asia.

“Strong revenue growth, in combination with last years’ cost reduction measures, has resulted in improved profitability. We are still working on low margin contracts, secured at the bottom of the oil and gas market. We do see some price recovery, however overall the offshore market is still oversupplied, resulting in a continued challenging pricing environment.

Løseth replaced Paul van Riel who retired in April 2018.

Løseth added: “I have spent the past months getting to know our business, people and clients around the world, in order to understand their needs and priorities. It is clear that Fugro has a strong brand and technological platform, professional and motivated people and a unique ability to provide integrated services on a global scale. I believe Fugro is well positioned to capture profitable growth in the years ahead.

“With Fugro’s current ‘Building on Strength’ strategy four years underway and in light of changing market circumstances and long term trends, Fugro will provide a strategy update in November. In that update we will address both the needed improvement in our performance and our long term vision.”

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