Northbridge Industrial Services PLC AGM Statement (3327H)
June 07 2017 - 2:00AM
UK Regulatory
TIDMNBI
RNS Number : 3327H
Northbridge Industrial Services PLC
07 June 2017
7 June 2017
Northbridge Industrial Services Plc
("Northbridge" or the "Group")
AGM Statement
Northbridge Industrial Services Plc, the industrial services and
rental company, today issues the following trading update for the
period 1 January 2017 to 31 May 2017, ahead of its Annual General
Meeting to be held later today at 12.00 noon.
As noted in the Preliminary results on 25 April 2017, sentiment
in the Oil & Gas industry has begun to improve following the
agreement between OPEC and other producer countries to reduce
surpluses. This was enacted on 1 January 2017 and has now been
extended for a further nine months beyond the 30 June 2017.
Compliance with this agreement, further supported by the scheduled
IPO of Saudi Aramco, has enabled the crude oil price to stabilize
at around $50 per barrel. This has encouraged the wider industry to
re-consider the development of reserves, which have slipped to a 70
year low during the downturn. As a consequence, the Group is seeing
a modest upturn in the investment plans amongst our customer base
leading into 2018. However, we still believe that the pace of the
recovery will be slow.
Other areas of Northbridge's activities have proved resilient,
most notably Crestchic Loadbanks, which are involved in power
reliability. This has become a particular issue in western
economies, with the continuing development of the Renewable Sector
and the decline in fossil fuel generation having led to
fragmentation of power sources. This has meant a continuing demand
for our services and the Group is increasing its presence in the
Renewable Sector.
Northbridge's business model is focused mainly towards rental of
equipment and the Group has high operational gearing, which is
coupled with a strong cash flow and a conservative depreciation
policy. Despite the continued trading losses in the period, EBITDA
remains positive and the net debt position will continue to
decrease during 2017. The separation of the Group's two trading
subsidiaries, Tasman Oil Tools and Crestchic Loadbanks, into
activity based management will enable better focus going forward
which will ensure all opportunities can be fully exploited.
Northbridge's balance sheet remains strong and the Group has a
substantial portfolio of rental assets which are readily available
for deployment. This gives us confidence to take advantage when the
recovery momentum increases. We have substantially reduced our
overhead costs and streamlined the core business and, while short
term trading visibility remains challenging, our performance will
be highly sensitive to modest improvements in revenue. Whilst we
believe this will be unlikely before the last quarter of 2017, we
remain optimistic that Northbridge will benefit from this
strengthened position when market conditions begin to improve.
-Ends-
For further information
Northbridge Industrial Services Plc 01283 531645
Eric Hook, Chief Executive Officer
Iwan Phillips, Finance Director
Stockdale Securities Limited (Nominated Adviser and Broker) 020
7601 6100
Robert Finlay / Antonio Bossi / Henry Willcocks
Buchanan 020 7466 5000
Charles Ryland / Stephanie Watson/ Catriona Flint
About Northbridge:
Northbridge Industrial Services plc hires and sells specialist
industrial equipment. With offices or agents in the UK, USA, Dubai,
Belgium, Germany, France, Australia, New Zealand, Singapore, China,
Brazil and South Korea, Northbridge has a global customer base.
This includes utility companies, the oil and gas sector, shipping,
banking, mining, construction and the public sector. The product
range includes loadbanks, transformers and oil tools. Northbridge
was admitted to AIM in 2006 since when it has grown by providing a
high level of service, responsiveness and flexibility to customers,
by the acquisition of companies in the UK, Dubai, Australia,
Belgium, New Zealand and Singapore and through investing further in
those acquired companies to make them more successful. Northbridge
continues to seek suitable businesses for acquisition across the
world.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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