PIPELINE technology specialist Stats (UK) generated revenues of £39.1 million ($50.69 million) and EBITDA earnings of £5.6 million according to its annual accounts as at 31 December 2019.
Despite the impact of the Covid-19 pandemic and the resulting significant fall in the price of oil, Stats said it was confident its 2020 performance and activity levels would be broadly consistent with those of 2019.
While revenues dropped by 10 per cent, down from £43.4 million, the accounts noted that the largest ever contract completed by Stats, for a major Abu Dhabi client, had made a significant contribution to the 2018 results.
Based in Kintore, near Aberdeen, Stats’ principal activity is the provision of pipeline testing, repair and integrity services, including the design, supply and provision of specialised test, intervention and isolation tools, to the international oil and gas industry.
The company’s success in recent years of internationalising its business continued, with 85 per cent of revenues derived from projects executed outside of the UK, a rise of 5 per cent on 2018.
In the Middle East, Stats has continued to secure contracts in its core markets of UAE, Oman, Kuwait, Bahrain, Qatar and Saudi Arabia.
Milestone achievements in 2019 included completing a key project for Saudi Arabia utilising the company’s patented Bisep technology, establishing an operational facility in Muscat to support work with Petroleum Development Oman, and successfully delivering a technically challenging large diameter isolation in Qatar.
Stats also completed subsea hot tapping workscopes in the UAE and in Egypt, and towards the end of 2019 the company’s Abu Dhabi branch moved to new larger facilities.
Elsewhere, Stats increased its market presence in the US where revenues grew by 176 per cent on the previous year, and relocating to larger facilities in Canada had allowed the ramping up of the in-house design and manufacture of pipeline fittings to North American clients.
Diversification away from a rental-only model of the company’s patented isolation tools to include product sales had found particular success in Canada and Iraq, while there was strong demand for the group’s Type Approved connectors in the UK oil and gas sector.
An important memorandum of understanding with Sakhalin Energy Investment Company and INTRA was signed in 2019 for a long-term frame agreement covering isolation works in Russia.
Stats Group CEO, Leigh Howarth, says: “As Covid-19 evolved in to a global pandemic in the early part of 2020, this had an impact on our trading performance. Not surprisingly, several significant contracts which had been a long time in planning were postponed by clients until later this year or 2021 but on the positive side there is a healthy programme of work ahead of us.
“The strong response from our staff across all our global locations in dealing with the changed environment was outstanding and the introduction of new working practices has allowed us to secure new contracts. As a result, and notwithstanding the impact of Covid-19 and the resulting lower demand for oil and the subsequent drop in price, we are optimistic that activity levels in 2020 will be broadly consistent with those of 2019.”
The group’s pre-tax profits for 2019 were £0.2 million compared to £2.5 million in 2018, while EBITDA earnings decreased from £7.6 million in 2018 to £5.6 million. Investment continues in to research and development activities relating to Stats’s proprietary technology products and to secure patents and trademarks where appropriate. —OGN