Shares in energy services firm to be suspended


SHARES in Petrofac are to be suspended after the firm delayed the publication of its 2023 annual results.

The energy services company – which is battling to restructure its debt – has told investors that there will be a delay in publishing its audited full year 2023 results, which it now expects to release by 31st May.

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As a result, shares in the company will be suspended from 7.30am on Wednesday until the results are released.

The London-listed firm, which employs 8,500 people worldwide, saw a collapse in its stock price of nearly 70% over the last few months.

Despite a run of contract awards, investor concerns have emerged around cash flow and profitability as debt and delayed collections on legacy contracts weigh it down.

On paper, things look bright – Petrofac has a “$8billion backlog” of orders, but cash flow will be crucial in ensuring that is deliverable.

This morning, the group provided an update on its debt, confirming that a group of senior secured noteholders have made a proposal to provide further credit to the business of up to $300million, comprising $200million of new funds and $100million of credit support to help secure performance guarantees for certain of its existing contracts.

This non-binding proposal is dependent upon, amongst other things, the company securing these performance guarantees, and would require the conversion of a significant proportion of the group’s existing debt to equity.

The update states: “The company is in active discussions with credit providers to obtain the required guarantees, which would also release over $200million of collateral and retentions, and will provide an update on the outcome of those discussions as appropriate.”

Petrofac’s banks have also agreed to a number of rolling short term deferrals of contractual amortisation payments while the company progresses the financial restructuring.

Petrofac Chairman René Médori said: “The Board and management are focused on arriving at a comprehensive refinancing solution as quickly as possible.

“We are encouraged by the engagement with the ad-hoc group of noteholders, which we hope demonstrates momentum in this complex process. We remain grateful to all our stakeholders for their patience and continued support of Petrofac.”

Tareq Kawash, Group Chief Executive, added: “Petrofac has a large order book of high-quality projects, strong market positions and compelling future opportunities which are evident from the recently announced awards.

“We are working to put the performance guarantees and the right capital structure in place, in order to deliver on this potential.”

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