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UPDATE 1-Cape Plc's first-half adj profit falls on strong pound
August 27, 2014 / 8:50 AM / 3 years ago

UPDATE 1-Cape Plc's first-half adj profit falls on strong pound

(Adds details, share movements)

Aug 27 (Reuters) - Cape Plc, a British energy services firm, reported a 13 percent fall in first-half adjusted pretax profit, hurt by a strong pound and fewer construction projects.

Cape said it expected a stronger second half, driven by higher orders in the first half and expected increased activity in its Wheatstone LNG project in Australia and a recovery in profit margins in the UK.

Orders for the period rose 33 percent to 317 million pounds, helped by its acquisition of storage tank maker Motherwell Bridge and the renewal of a three-year maintenance contract with a power supplier in Hong Kong. Cape bought Motherwell for 37.7 million pounds in March.

“We believe a ramp-up in activity at Wheatstone, an improving UK onshore margin, as well as the positive impact of the Motherwell Bridge acquisition provides visible growth in 2H14 and 2015,” Numis analysts said in a note.

Adjusted operating profit the for the six months ended June 30 fell to 23.4 million pounds ($38.8 million), from 26.5 million pounds a year earlier.

Revenue fell 13 percent to 322.3 million. The company, which gets more than half its revenue from outside the UK, said about 10 percent of the fall in revenue was due to the completion of several construction projects in 2013.

Pretax profit nearly tripled to 17.1 million pounds.

Cape, which supplies scaffolding, insulation, industrial cleaning and fire protection services to oil and gas and power plant operators, kept its interim dividend at 4.5 pence.

Shares in the company were down 0.2 percent at 302.5 pence in thin morning trade on Wednesday on the London Stock Exchange. ($1 = 0.6036 British Pounds) (Reporting by Abhiram Nandakumar in Bangalore; Editing by Gopakumar Warrier)

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