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Tekmar Group shares fall after issuing revenue warning amid provide chain and price pressures

Offshore power specialist Tekmar Group has issued a revenue warning regardless of unveiling a bulging enquiry e book because it highlighted its battle in opposition to provide chain headwinds.

The Darlington-based enterprise stated contract wins around the globe are serving to it to ship on its plan to double revenues in 5 years, however that it has not been resistant to the problems affecting international commerce flows.

Constraints extensively being felt throughout many sectors have impacted Tekmar’s operations together with challenges with transport items for supply, provide chain constraints and price management pressures.

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These headwinds imply the group expects to report income of £46m however an adjusted Ebitda loss within the area of £1.2m for the prolonged monetary interval.

Shares fell by greater than 14% in early buying and selling to 41.16p, following the announcement on buying and selling for the prolonged 18-month monetary interval to 30 September 2021.

The group has 5 primary working corporations – Tekmar Power, Subsea Innovation, AgileTek Engineering, Ryder Geotechnical and Pipeshield Worldwide – and highlighted a lot of contracts wins.

Offers embody a contract with Van Oord for the Baltic Eagle offshore within the Baltic Sea, Germany, and a partnership settlement with DeepWater Buoyancy to focus on the worldwide floating wind market and the US mounted offshore wind market.

It’s also finishing up work for a subsea tasks in Qatar and the UK, in addition to varied contract awards supporting offshore wind operations and upkeep tasks.

It stated the offers have helped to assist development within the present enquiry e book to £359m, a rise of 31% on the June 1 complete of £273m, in addition to a more-than-doubling in most well-liked bidder tenders from £4.5m to £10.4m in the identical interval.

Nevertheless, it stated it has been experiencing constraints extensively being felt throughout many sectors, which has impacted Tekmar’s operations together with challenges with transport items for supply, provide chain constraints and price management pressures.

Regardless of its losses, the board stated its expects the profitability from the scale and nature of it contract combine to enhance within the present monetary yr to September 2022.

CEO Alasdair MacDonald stated: “From a buying and selling perspective the corporate has not been immune from the dislocation to international commerce flows and its affect on international financial exercise.

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“While this has impacted our monetary efficiency within the close to time period, our money place is sound and we proceed to be vastly inspired with the operational progress we’re making in delivering on our strategic objectives and by the rise in enquiry e book to £359m, reflecting elevated confidence in exercise ranges in our markets.

“We’re securing landmark contracts with main international companions and this helps underscore our confidence in our customer-led development technique.

“We stay very energised in regards to the alternatives we’ve forward which is additional strengthened by the latest pledge of £9.7bn introduced earlier this week on the World Funding Summit in sectors together with wind power.

“The trade is at a significant inflection level when it comes to vital acceleration in offshore wind capability funding.

“This mixed with the broader power transition aligned with the online zero by 2050 crucial and our initiatives to deepen and lengthen {our capability} throughout power tasks’ life cycles present clear drivers for sustained future development.”

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