Integra posts FY 2008 Net Loss of $271.9 million
Russian oilfield services provider, Integra, has posted a FY 2008 Net Loss of $271.9 million under IFRS.
The bottom line result is more than 5 times worse than the $50.8 million loss posted for FY 2007, with FY 2008 Adjusted EBITDA falling 23% year on year to $161.9 million, despite FY 2008 Sales rising 22.8% to $1.445 billion.
The company says the result reflected a stable environment for 9M 2008 followed by a dramatic 4Q which saw a slump in oil prices, coupled with financial difficulties for some customers and reductions in demand for Integra’s services. These meant the company faced contract cancellations and a range of one off costs during the quarter, which also saw $52 million worth of write offs and impairments.
CEO, Felix Lubashevsky indicated that the environment had stabilized somewhat but that the outlook remained unclear.
“The global economic slowdown had an adverse effect on our business growth and profitability expectations, as well as on the financial position of certain of our customers. We took a rigorous approach to reviewing our asset values and recognised significant impairment charges against goodwill, intangible assets, receivables and inventories. In addition to the write downs, our performance was negatively affected by exchange rate movements, cancellation of contracts and certain project accidents resulting in adjusted EBITDA of US$ 162 million, which is well below our initial expectations.
In 2009, we have seen some signs of stabilisation of demand for our services and equipment due to the combination of more stable oil prices, favourable oil tax changes and the beneficial effect of a weaker Ruble for exporters. We have made good progress with our order book for 2009, and adjusted our cost base so that we can execute it efficiently. We continue to view the current operating environment as highly dependent on volatile commodity prices. Our plan is to focus on cashflow generation and the new business opportunities that this market may bring.”