The last quarter was a particularly bad time to be doing business for Stolt Offshore.

The company was in the red to the tune of œ11.6 million ($18 million).

The offshore contractor designs, procures, builds, installs and services a range of offshore surface and subsurface infrastructure for the offshore oil and gas industry worldwide.

It uses a variety of remotely operated submarine vehicles (ROVs) for specialised deep water engineering and surveying projects typically associated with drilling, salvaging or mapping operations.

The firm's net losses for the three months to the end of February compared with net profits of œ127,000 for the same period a year earlier. (œ1=$1.5)

Net operating revenues for the three months were œ265.5 million, against œ187.3 million the year before.

Tom Ehret, chief executive, admitted, "This has been a particularly difficult quarter."

He added, "We experienced significant delays and cost over-runs on two major EPIC (engineering, procurement, installation and commissioning) projects in Africa because of operating problems, programme changes, bad weather and local community difficulties.

"The good news is that on most other projects performance was better than budget."

Ehret said that the UK North Sea market was very competitive, but the company was doing well with ongoing construction contracts.

It had been awarded a two-year extension to a long-term BP maintenance programme.

The chief executive added that, despite Stolt Offshore's current difficulties, the markets in which it operated presented significant growth potential in the medium term.

"2003 will continue to be a tough year for Stolt Offshore as we work through the low-margin contracts.

"The company still has integration issues outstanding from its rapid growth that need to be resolved, however it also has sound fundamentals and good management systems in place.

"My target is to present a blueprint, detailing the way forward, by the end of June to both employees and investors," he said.

A spokesman for the group said that although it was too early to speak of the implications of the blueprint, the firm was looking towards an increasing level of work from the UK North Sea.

With over 6,000 employees operating worldwide, Stolt Offshore identifies itself as a integrated offshore and subsea construction company.

Its capabilities include: