Craig International’s expansion into North America, the Middle East and South Africa reaped big rewards during the year to April 30.
Annual accounts for the Aberdeen-based oilfield procurement business and its holding company, Craig Group, show pre-tax profits surged to £659,349, from about £81,000 the year before as turnover rocketed 18.5% to £135.9 million.
Operating profits increased to £766,000, from £144,000 previously.
Craig International said yesterday its overseas business achieved 30% turnover growth during its 2019-20 trading year.
For the second year in a row, Craig International’s overseas business – generating sales worth £90.3m – accounted for about two-thirds of group turnover. The largest international market is North America, followed by the Middle East, where the firm has recently opened an office in Oman to complement existing operations in the United Arab Emirates (Dubai) and Qatar (Doha).
Craig Group chairman Douglas Craig also pointed to a strong performance in South Africa, adding: “These results reflect the success of our investment in new locations around the world and in organic growth.
“We’ve made major strides in expanding our business into North America, the Middle East and South Africa, and will continue to invest further in our diversification in these markets.
“The North Sea market, which accounts for £45.5m of our revenues, continued to be challenging, but we have retained our market-leading position and were starting to see an increase in activity pre-Covid.
“Since April, we have experienced a reduction in activity due to the impact of the global pandemic and the collapse in oil price.
“However, we have been proactive in reducing our cost base to mirror this reduction, allowing us to maintain a stable operating base going into the new financial year.”
Mr Craig said the group’s global reach and “robust” financial position, combined with a “skilled and experienced workforce and digital processes”, meant it was well-positioned to withstand the disruption of 2020 and capitalise on an anticipated recovery and increase in activity in 2021.
Craig International has nearly 130 employees, across bases in Aberdeen, Cape Town, Calgary, Doha, Dubai, Hamburg and Houston, and a global network of suppliers.
It also boasts 60 third-party procurement service buyers in seven countries.
In a section on future developments in the group accounts, which were signed off earlier this week, Mr Craig said the company had taken actions to deal with the new business environment and continued to look for opportunities to expand into new areas.
The downstream oil and renewable energy industries were a particular area of focus, he said, adding he had a “reasonable expectation” of the group having enough resources “for the foreseeable future”.
On the UK’s looming exit from the EU and any potential impact on the business, Mr Craig said: “While the directors cannot control the outcome of Brexit, they are planning for its potential outcomes.
“This includes monitoring political progress, considering guidance and support from the government, working with key suppliers to ensure availability of future supply of raw materials and, where possible, estimating the future impact of any tariffs applied to imports and exports.
Craig Group employed 128 people, on average, during 2019-20 – up from 109 the year before.
Mr Craig is the company’s sole director and 100% shareholder. The business was founded in 1933 by Mr Craig’s grandfather, George, who operated three deep-sea trawlers.