LONDON - Hunting PLC (LSE: HTG), a precision engineering group, today provided a trading update confirming its 2023 financial performance aligns with previous guidance and market expectations. The company anticipates an EBITDA between $96 million and $100 million, with group revenue estimated to range from $925 million to $930 million.
This EBITDA reflects an increase from the 7% margin in 2022 to approximately 10.5% for the past year, progressing towards the 14-16% target set for 2025. Hunting's sales order book has seen a significant uptick, currently valued at around $575 million, a 12% rise since the end of the third quarter of 2023 and a 21% increase from the year-end of 2022.
The company's balance sheet exhibits robust cash generation in the fourth quarter of 2023, with total cash and bank balances expected to equal borrowings, effectively reaching a net debt position of approximately zero, consistent with the outlook provided in October 2023. Furthermore, Hunting completed the disposal of its remaining oil and gas production assets in the last quarter, aiming to streamline its operations further.
In terms of product lines, Hunting's OCTG (Oil Country Tubular Goods) products, including Premium Connections and Accessories, are projected to see a revenue increase of about 53% compared to 2022. However, Perforating Systems are expected to report a slight revenue decrease of 3-4% due to a roughly 20% drop in the North American rig count. On the other hand, Subsea product lines and Advanced Manufacturing have reported strong growth, with increases of about 40% and 45% in revenue, respectively.
The North America operating segment has experienced substantial EBITDA growth, propelled by demand for Premium Connections and Accessories. The Titan operating segment has delivered stable results despite a declining US onshore rig count, while the newly formed Subsea Technologies segment has benefited from increased offshore drilling investments.
For 2024, Hunting maintains its EBITDA forecast of $125 million to $135 million, bolstered by the robust sales order book. This outlook aligns with current market expectations.
Hunting, established in 1874 and headquartered in London with a corporate office in Houston, operates across the United Kingdom, China, Indonesia, Mexico, Netherlands, Norway, Saudi Arabia, Singapore, United Arab Emirates, and the United States. The company's financial reporting is in US dollars across five segments: Hunting Titan, North America, Subsea Technologies, EMEA, and Asia Pacific.
This news article is based on a press release statement from Hunting PLC.
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