Industrial service group Cape said yesterday it was back in the black in 2013, helped by a strong performance in a flat market for oil and gas work in the UK North Sea.
Joe Oatley, chief executive, said weakness in Kazakhstan and Asia Pacific was partly offset by growth in the UK and Middle East offshore markets.
Mr Oatley said conditions were mixed across Cape’s three operating regions, with a number of major capital investments in the oil and gas and mining industries delayed.
He added: “As anticipated, this resulted in lower activity levels of construction services in a number of our markets.
“Demand across the UK, Europe and CIS region (the former Soviet Union) was variable, with the UK market flat and a marked reduction in activity in Kazakhstan as key projects completed early in the year and investment by our clients in new projects was deferred.”
Mr Oatley said market conditions in the UK, Europe and CIS region were likely to remain variable during 2014, with flat demand from the UK and a slight increase in activity towards the end of 2014 in the CIS region.
He added: “We anticipate that the UK business will feel the effect of increasing competition but, with a continued focus on efficiency improvement and the ongoing development of our joint venture activities in Kazakhstan and Azerbaijan, we are targeting to deliver an improvement in operating margin for the region.
“The long-term demand for the group’s services is expected to continue to grow, driven by increasing investment in the oil and gas and power industries.”
Cape, which last week announced its acquisition of Scottish engineer Motherwell Bridge in a deal worth £37.7million, posted pre-tax profits of £200,000 for last year. This was compared with losses of £143.2million in 2012.
The firm highlighted a 48% jump in adjusted operating profits, to £41million, though revenue fell by nearly £40million to £697.1million after the reduced activity in Kazakhstan and Asia Pacific as well as a string of big contracts ending.
Mr Oatley said the results reflected a “much-improved” performance, adding the volume of construction service contract awards was likely to rise in late 2014 and 2015.
Cape employs nearly 1,000 people in the UK and around 21,000 globally.