The Global Energy Group (GEG) today released its financial statements for 2012/13, confirming a second consecutive year of considerable growth – 43% up on the previous year’s sales.
Turnover grew from £250 Million to £358 Million to the year end March 2013, with earnings before interest, tax, amortisation and depreciation (EBITDA) at £34.5 Million, compared to £16.9Million in 2011/12.
The results represent the maturity of the business and the market’s positive response to a value proposition that can reduce risks in construction and drive operational performance on critical assets.
Iain MacGregor, GEG’s Chief Executive, said: “There are two parts to the group, covering ‘operations & maintenance’ and ‘projects’ activities. We are pleased to see considerable growth in both of these areas – underpinned by different factors.
“The increased capacity of the Nigg Yard on the Cromarty Firth, in the north of Scotland, and a strengthening North Sea market has influenced strong organic growth in our ‘Projects Group’. A number of field-life extensions and new developments have ensured a steady flow of subsea projects and topside modifications for our fabrication business.
“The opening of the dry-dock at Nigg also increased the volume of rig/vessel projects attracted to the Cromarty Firth. The acquisitions of Ross-Shire Engineering and Prime Pumps also permitted entry to the onshore Utility and Power markets, widening the market and skillsets offered by the projects group.”
“The targeted acquisitions of A&B Welding (UK) and Vertech (Australia) fuelled further growth in the group’s Operations and Maintenance offering during the year. The former enhanced the group’s capacity to support the North Sea integrity market; increasing volumes of steel replacement on ageing infrastructure. The acquisition of Vertech strengthened a growing portfolio in Australia, adding integrity inspection and access solutions in the Asia Pacific region. Further organic growth in the Gulf of Mexico (USA) marked a successful campaign to broaden the group’s international reach.”
Mr MacGregor highlighted the international growth as significant in the group’s trading position, adding: “International sales grew by 142% last year, which reflected our strategy to enter other mature markets. The effect of this has been positive in sales growth, but more specifically felt in higher profit returns. We have learned many lessons from growing a UK portfolio and have adapted our approach to developing international locations. This is yielding good results in Asia Pacific and also the USA.”
Global’s continuing strong performance was praised by Mitsui & Co, the Japanese corporation that took a 25% in the family-run business in 2012.
Mitsui’s Noboru Katsu, Operating Officer and Regional Client Officer for Europe, Middle East and Africa, said: “We joined forces with Global because we were impressed with their excellent management qualities, as well as their previous development and determination to achieve continuing sustainable growth in the UK and internationally.
“We have quickly established good working relationship with the company and are delighted to be part of its success and its ambitious plans for future growth.
“The results announced today are highly impressive and a testament to the skill and hard work of the whole Global team. We are confident this success will continue in the coming year.”
Looking ahead, Mr MacGregor said: “I expect a third year of 40%+ growth since we are already trading at the £500 Million level this year.
“The number of secured projects for the Nigg yard, including the first FPSO enhancement/life extension, will positively influence growth in our projects group in the current year.
“Acquisition growth in the latter part of the year will be focused in the operations and maintenance space, particularly in international markets. The directors expect to replicate the successful footprint established in Australia, but in other mature oil and gas basins. Enhancing our existing propositions in the USA (Gulf of Mexico) and Norway are expected to take priority in 2013/14 – as well as further growth in Australia.”