Petrofac Share Discussion Threads

[asturius101] 24/11/2014 21:03

Well, then sell. Your choice sonny.

[mirshahik] 24/11/2014 21:00

Bad project management is a big worry and creates uncertainty. May be a bargain at this price if they manage all other projects well. What if they don't?

[asturius101] 24/11/2014 20:59

Will add more tomorrow if it dips

[mirshahik] 24/11/2014 20:56

If I remember correctly it was about £4 in 2009. Deadcat bounce happens in a day or so after the drop. Please stop posting BS.

[asturius101] 24/11/2014 20:56

Bargain at these levels...15k worth today

[ards] 24/11/2014 20:53

back to 2009 levels. hard to know how to play it. Usually dead cat bounce takes a few weeks to materialise. in almost half drops the trend is down for next few days.

[nick100] 24/11/2014 18:20

StockMarketWire.com - Petrofac said it is on track to deliver FY 2014 net profit towards the lower end of the $580m-$600m range provided in previous guidance. It reported a strong order intake of $10bn year to date and backlog at a record level of about $21bn.

Looking to 2015, Petrofac said the lower oil-price environment and expectations of delivery on certain IES projects, coupled with anticipated outcome on Laggan-Tormore, was likely to result in net profit in 2015 of about $500m.

This 2015 guidance reflected:

o current 2015 forward curve for oil price expected to reduce IES net profit by around US$45 million compared with previous guidance and current market expectations(1)

o our latest view of cost and the timing of first oil in respect of the Greater Stella Area project in the UK North Sea

o rephasing of certain field development activities under our existing Mexico PECs pending conclusion of the potential contract migration process

o managing our field investment on the Ticleni PEC in Romania as we continue to work towards a revised Field Development Plan

o an expected final commercial settlement in respect of the Laggan-Tormore project in Shetland resulting in no profit or loss being recognised in 2015 on the project

CEO Ayman Asfari commented:

"This has been a difficult period for Petrofac and the industry. The Board has analysed the potential impact of a lower oil price environment on our IES business and also made a critical assessment of our expectations for project delivery in 2015.

"In the main our project portfolio is in good shape, but it is clear that on a small number of projects our execution has fallen short of the high standards we set for ourselves. We have faced these difficulties and have taken robust action to address them and believe this leaves us on a surer footing for the future.

"The foundations of the business remain strong. Our ECOM division is in very good shape, with good progress made on the resolution of a number of ECOM commercial settlements, a record level of backlog and an attractive pipeline of bidding opportunities.

"We are implementing clear and robust plans to improve project delivery and drive value from the IES contract portfolio.

"I am confident that Petrofac will meet the challenges presented by certain projects in our portfolio and the medium-term growth prospects for our business remain strong."
- See more at:

[salpara111] 24/11/2014 17:22

Just be careful playing this now as it would be relegated from the FTSE 100 on a share price of under 900p.

[plunger2] 24/11/2014 17:19

Ha dean - you beat me to the punch on Moffat!
It seems as if many of the mistakes made by (the relatively minor)LAM have been replicated at PFC. Just reading Cannacord quoted above shows that LAM's new management have actually been on the ball relative to PFC.
It surprises me - perhaps they should takeover LAM and learn the secrets!!! LOL

My sympathies to PFC holders.

[leedskier] 24/11/2014 16:49

At the end of October the shares on loan amounted to 7.22%.

[wipo1] 24/11/2014 15:29

I took this off my watch list when I saw a few brokers ramping up price targets! 25pc fall for a ftse 100 stock ouch, I am still mostly in cash.

[deanowls] 24/11/2014 14:48

With a 21b order book and still profitable they have decent room to manoeuvre, hopefully some lessons learnt on over promising, hopefully as a lam holder they don't go after Mr Moffat!

[leedskier] 24/11/2014 14:14

I have never been invested here, but I spent some time reading about it this morning.


Costs overrun, especially offshore, seem to be a problem.


The BP. disaster must have increased costs enormously. No wonder they say any further N.S. contracts will be costs plus. The problem is those offering contracts, like XEL, want profit sharing contracts, not costs plus, and they are getting them too.


These businesses become too stretched globally and lose focus.


As commented above, it is a management issue.

[hatter2] 24/11/2014 13:57

Sold my holding, the last lot back in May this year although I still retain them on my watch list but heavens knows why. My original sales were based upon an ever increasing loss of confidence in the management of the business. I agree resource based stocks can be cyclical but once I have lost faith in management then I am off.

I have to admit that I never managed to make any money from my PFC in’s and out’s over the last couple of years.

I hope it works ok for current holders; all the best.

[ards] 24/11/2014 13:10

sorry to say but good short on dead cat bounce

[ohisay] 24/11/2014 13:09

Cannacord comment

Of the c.$200m downgrade of net profit compared to consensus, c.$25m relates to
the PetroFirst transaction, $45m oil price, $30m Mexican PECs and Ticleni, $40m to Stella, $40m to Laggan-Tormore, and the remainder is analyst error and financials.
Some of this is arguably ‘one-off,̵7; and much is lessons learned. On today’s call the CEO Ayman Asfari stated that Petrofac will always in future bid on Shetland work (eg. Laggan-Tormore) on a cost-plus, not a fixed price, basis.
What is striking about Petrofac’s litany of woe is that none of it stems from the core Sharjah-based operations: although some of Petrofac’s international projects are successful, the hit rate is strikingly low, and no better than peers’. The major problems are two offshore North Sea projects, in one case centring on poor yard productivity as well as customer change orders, in the other challenges with weather and labour relations. Most of this is effectively ‘new’ to Petrofac, in the sense that its traditional focus (on onshore, and sour gas processing in particular) has been elsewhere, and the capability has been added in recent years.
In this context, it is little wonder that the market is so sceptical on Petrofac’s further investment projects, notably the subsea development unit the JSD6000. We are more positive, not least because plenty of companies (eg. Saipem) have run a successful offshore strategy using just one vessel. However, it is clear that Petrofac needs to do much more to deliver. We now expect 84% of 15E net profit to come from the core MENA business run from Sharjah, and 65% in 16E.
We are cutting EPS 8%/27%/23% for 14/15/16E (but just 12% thereafter) and cut our target 18% to 1150p from 1400p. We remain cautious BUYers, as we believe we are close to the trough in terms of free cash generation, that backlog for 15E is very strong, that Petrofac remains generously funded with net debt / EBITDA peaking at just over 1.1x, and that despite its woes the stock will trade at 12/11x 15/16E P/E.

[ards] 24/11/2014 13:07

live and learn. sold out when hit 1200 resistance then bought back in when it broke. just goes to show believe nothing a management tells you, only the market. also keep positions smallish and expect the unpredictable.

[togglebrush] 24/11/2014 13:04

Daily Trading passed the 'One in a hundred day' level within first 30 minutes this morning
'
Using ADVFN data for 2014 stats are
'
Max is _____________6,321,363 on 9th May following an IMS. share price intra day -15%
One in a hundred is 3,281,301
Quartile 3 is ______1,511,701
Median for 2014_____1,115,989 middle of a sorted sample

[deanroberthunt] 24/11/2014 13:01

ready for the Santa Rally boyz ?

[leedskier] 24/11/2014 12:57

David Buik was making the point pre market on twitter that the Russian Stock Market was up 2% year to date whereas the FTSE100 was only up 0.2%.

[leedskier] 24/11/2014 12:54

I think that comment was made when another bluechip was being topsliced.

[bulltradept] 24/11/2014 12:45

Someone commented on the RBS BB a few weeks ago that the FTSE100 is as volatile as Aim.

25% off a FTSE100 company?

This market is not safe.
_________________________
Company specific though surely?

[bench2] 24/11/2014 12:35

There now has to be uncertainty about whether they can manage a 21bn order book , do they have the management in depth ? Is this the Balfour Beatty of the oil service sector ?

[leedskier] 24/11/2014 12:35

Someone commented on the RBS BB a few weeks ago that the FTSE100 is as volatile as Aim.

25% off a FTSE100 company?

This market is not safe.