Oil refinery consultancy and software provider KBC Advanced Technologies says that trading is in line with expectations and it expects a stronger performance in the second half of 2010.
The consultants are busier than they were earlier this year. Utilisation rates are improving. Increasing the utilisation of consultants will improve margins.
The order book was worth £40.8m earlier this year and it is still worth around £40m. June was the strongest month of the year with £6m of orders won.
KBC reported a small dip in revenues from £52.8m to £52.6m in 2009 but the latest figure includes a software deal with Brazilian oil company Petrobras which was announced a matter of days before the end of year. The underlying profit ended up flat at £5.7m. That excludes amortisation and £700,000 of redundancy costs. KBC made cost savings of £2.8m during the year and the full benefit will show through in 2010. A further £1.3m of cst savings have been made this year.
The cash inflow was lower than normal in 2009 but this was mainly due to bonuses that were included in creditors at the end of 2008 and paid during 2009. There won’t be bonuses for 2009. Net cash was £4m at the end of 2009. The total dividend was increased from 1.35p a share to 1.55p a share.
Analysts forecast profits of £5.1m this year.
Refinery capacity is being closed in Europe and North America but there is greater investment in new refineries in India, China and near to the oil in the Middle East.
At 42p a share, up 1.5p on the day, KBC is valued at £23.2m.
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