AGM Statement

 

TIDMVELO 
 
RNS Number : 9867N 
Velosi Limited 
22 June 2010 
 

Velosi Limited ("Velosi" or "the Group") 
 
                          AGM STATEMENT BY THE CHAIRMAN 
 
 
John Hogan, Chairman of Velosi, the provider of Testing, Inspection and 
Certification services to major national and multinational oil and gas 
companies, will make the following statement at Velosi's Annual General Meeting 
being held today at 11.00 a.m.: 
 
"As anticipated, Velosi continues to perform well despite the more challenging 
market environment. Building on a strong base, with 60% of forecasted revenues 
already under contract for 2010 at the outset of the year, the Group is 
continuing to trade in line with market expectations. 
 
Volatility in oil and gas prices has led to a more cautious approach by the 
major oil & gas companies towards new projects and a subsequent reduction in 
capital expenditure across the sector over the last 18 months. There is however 
an over-riding need to ensure that all new and existing projects meet the 
required safety standards and this is a core driver for our business. The recent 
large oil spillage in the Gulf of Mexico has further served to highlight the 
importance of safety and the significant potential downside that exists for 
operators. 
 
So far in 2010, the Group has continued its excellent retention record for 
existing contracts and won further new contracts particularly in the Middle East 
and Africa.  Such wins include an inspection contract with Qatar Petroleum 
estimated to be worth approximately $5m over 3 years from August 2010, and a 
third party inspection contract with Abu Dhabi Ports Company estimated to be 
worth $6m to Velosi over 4 years from January 2010, with potential for this to 
increase over the life of the contract. 
 
While activity levels are relatively subdued, there are some areas or 'hot 
spots' where there is continuing significant investment such as Brazil, 
Kazakhstan, Australia and West Africa. We are investing in developing our 
presence in these regions alongside the major operators, either through 
establishing an office in the region, expanding existing resources or by 
creating local partnerships to enhance our services. 
 
Since the early part of last year, the Group has focused on maintaining a strong 
cash position to support ongoing activities and invest in developing the 
business through new office openings and support infrastructure. In 2010, new 
offices have opened in Thailand, Pakistan and Poland.  A local presence is 
fundamental to our ability to deliver the level of services our customers 
require and this model is well proven by the Group's track record to date. 
These investments in developing the business are adding to the Group's cost base 
in the short term, in return for which we expect these new areas to contribute 
to growing the Group's revenue and profitability and diversifying the Group's 
geographical offering. 
 
In addition, we continue to focus on ensuring the business operates on a 
streamlined cost base, whilst also keeping the potential to acquire companies 
with geographic or technical abilities that would enhance the Group's ability to 
service existing or potential clients. 
 
We look forward to reporting on the performance for the first six months of the 
year in more detail at our half year results in September". 
 
                                      -END- 
For further information, please contact: 
 
+--------------------+----------------+-------------------+ 
| Velosi             | Dr Nabil Abdul | 020 7930 0777     | 
|                    | Jalil          |                   | 
|                    | Joe Vincent    |                   | 
+--------------------+----------------+-------------------+ 
| Strand Hanson      | James Harris   | 020 7409 3494     | 
|                    | Richard        |                   | 
|                    | Tulloch        |                   | 
+--------------------+----------------+-------------------+ 
| Charles Stanley    | Mark Taylor    | 020 7149 6000     | 
| Securities         |                |                   | 
+--------------------+----------------+-------------------+ 
| Cardew Group       | Tim Robertson  | 020 7930 0777     | 
|                    | Catherine      |                   | 
|                    | Maitland       |                   | 
+--------------------+----------------+-------------------+ 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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